In the relationship between the firm (or any other kind of organization) and the consumer we can distinguish three alterations of trust: calculus, institutional, and personal trust. This post will explain these three alterations.

Calculus trust

Calculus trust considers the information passed; the source are social experience and past own experience with the specific firm. Information for this trust can also be based on tests of quality, guarantees, and findings. Calculation is one of the main elements of consumer trust; retail banks employ certain concepts to support this confidence building.

Institutional trust

Institutional trust plays a crucial role in the banking business in general and in retail banking in particular. This trust modification is based on activities of customer organizations and existing legal regulations. According to BAUER et al (2007) institutional trust combines two aspects, one aspect concentrates on persons and another aspect focuses on their position within the society. Trust in bank employees is simultaneously trust in financial institutions when, for example customers assume that the bank employee in the local branch or in the call centre will render them the services which they can expect in legal terms (based on their contracts). This assumption is not based on results of interpersonal experiences – though it can be affected by those – but on induction from other experiences. Hence trusting in specific types of organizations, i.e. banks, in terms of an institution in everyday life means to bind a specific situation to a particular framework.

Personal trust

Personal trust represents the third alteration of trust. NOOTEBOOM and SIX (2003) highlight that developing trust in the form of personal trust requires substantial efforts on the part of the individual actors. BAUER et al (2007) define personal trust as trust in already existing relationships. Like calculus trust this trust form is based on experience. GIRMSCHEID and BROCKMANN (2005) call this trust as “history based trust”. But personal trust is based on a specific strand of experience which is independent to other strands and includes a degree of generalization of experiences. GRUDZEWSKI et al (2008) argue that in personal trust the customer fully believes in a given brand and the brand’s controls.

In this trust situation the customer perceives all undesirable situations or circumstances as something very rare. This belief in the overall brand can arise because of a sound long term relationship between retail bank and customer. This is in line with a small relation between age of the customer and personal trust. According to WITTMANM et al (2008) the effect of age is not significant in terms of personal trust; however it was observed that the following tendency exists: the older a person is, the more reluctant he is to be willing to trust.