An empirical exploration of the drivers of trust in consumer financial services

Abstract

Studies on trust in financial institutions are scattered across the literature and the results are often inconsistent, highlighting the need for additional investigation. Thus, relying on 1697 responses to a self-administered online questionnaire from consumers aged 18 or older in the U.S., we empirically examined several of these inconsistencies. Specifically, we explored how trust differs between seven types of financial services providers and between “customers” and “familiar non-customers” for each provider type. We also investigated how sociodemographic characteristics, generalized trust, previous experience, and the behavior and characteristics of financial services providers impact trust in different types of providers for “customers” versus “familiar non-customers.” Our results show that trust ratings differ across providers and between “customers” and “familiar non-customer” for the same provider type. Our results also show that there are distinct drivers of trust for “familiar non-customers” and “customers.” Indicators of reputation are important drivers of trust for “familiar non-customers,” especially for online-only financial companies. Shared values, interest protection, and personalized service are important drivers of trust for “customers,” especially for investment/brokerage firms, national banks, and credit unions. Taken together, these findings can help researchers and practitioners to better design marketing strategies geared toward building, maintaining, and repairing trust.