Banks and building societies have overtaken the retail sector for the first time in a long-running customer satisfaction index.
The top spot for the banking sector as a whole came as Nationwide Building Society was named in the research as the top brand for customer service.
Retail has traditionally led sectors for customer satisfaction since the UK Customer Satisfaction Index (UKCSI) was launched in 2008.
The Institute of Customer Service, which publishes the index, said the retail industry’s traditional dominance reflects its longstanding focus on competitive positioning, personalisation and responsive customer service.
But its latest index found that banks and building societies had overtaken retail as the highest-performing sector for customer service, surpassing it for the first time since the UKCSI started.
Banks and building societies as a sector received a score of 82.0 out of 100.
Non-food retail scored 81.0 and food retail scored 80.6.
Customers are asked in the research to rate their experience of dealing with specific organisations in the previous three months. They rate one organisation that they have had experience with in a particular sector.
The Institute of Customer Service said it attributes the improvement for the banks and building societies sector to the growing emphasis placed on customer satisfaction, loyalty and retention by the best-performing banks and building societies in recent years.
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It said this has been driven by investment in training and technology, healthy competition and the customer outcome-focused Consumer Duty standard.
The Consumer Duty, which is overseen by the Financial Conduct Authority (FCA), was introduced in 2023, setting higher standards for financial services customers.
It requires firms to put customers at the heart of what they do, including when designing products, communicating and considering whether customers are in a vulnerable situation, due to poor health or financial difficulties, for example.
An FCA spokesperson said: “We’re pleased to see the Consumer Duty continues to have a positive impact, helping to build the confidence and trust people need to navigate their financial lives.
“Better satisfaction is better for business, and we’ll keep working with firms to help them to deliver positive outcomes for customers.”
The UKCSI is published twice a year – in January and July.
Named in the latest index as the top brand for customer service, Nationwide Building Society received a score of 87.3 out of 100. It was followed by John Lewis, which scored 87.1, and First Direct which scored 86.0.
In November 2025, Nationwide pledged to keep all its branches open until at least 2030. It said in November that it has seen a particular increase in account openings in locations where it is the “last branch in town”.
In May 2026, the building society announced details of its latest Fairer Share payments, totalling around £440 million and going to around 4.4 million eligible Nationwide members.
Stephen Noakes, group retail director at Nationwide Building Society, said: “As a mutual, we’re able to put members first, whether that’s through our commitment to keeping every branch open, continued investment in digital services, or sharing success directly with eligible members through our £100 Fairer Share payment for the fourth year running.
“Our colleagues work hard every day to support members however they choose to bank with us, and we’re pleased to see that reflected in these results.”
Jo Causon, chief executive of the Institute of Customer Service, said: “Customer satisfaction with banks and building societies has been improving steadily for some time now, in what has been a long-term turnaround for an industry whose reputation was severely damaged with the financial crisis.
“The sector has led the way in app development, with many providers now offering an excellent digital experience for routine transactional elements combined with well-trained, motivated and empowered employees for more complex requirements. Regaining trust has been paramount.
“It’s also likely that Consumer Duty has played a role in ensuring financial services businesses focus on the customer experience, specifically in the boardroom.”
Andrew Gall, head of savings, consumer and insight at the Building Societies Association (BSA), said: “It’s great to see banks and building societies recognised for improving customer service.
“Customers want the convenience of great digital banking alongside the reassurance of being able to speak to someone face-to-face, and building societies’ continued investment in branches, telephone and digital services is helping to build the trust and confidence that people value.”
The UKCSI tracks 13 sectors across the UK economy, all of which saw an increase in customer satisfaction compared with last year.
The index also found that since January, the proportion of people who feel better off compared with a year ago has fallen from 38% to 35%.
There are also signs that falling confidence could be influencing people’s willingness to spend on “big ticket” purchases, with 36% of people in the latest research saying now is a bad time to buy major items, compared with 31% in January.
Ms Causon added: “Businesses are still managing through a period of volatility, and we may need to accept that this is the new normal.
“In a competitive landscape, we are seeing winners emerge who build trust, do the right thing and deliver a product and service experience that their customers genuinely value.”
The index is based on surveys involving more than 15,000 customers across the UK by TLF Research, with analysis by the Institute of Customer Service’s research team. The latest data was collected in March and April.