Balancing your bank account?

CONSUMER WATCHDOG | Friday May 11, 2007 00:00

First it was FNB and their 'Islamic' fixed-repayment loans, then Stanbic and their no-minimum-income accounts and loans. Recently, Barclays have been suggesting the extremely rapid issue of debit cards. 

This week, Standard Chartered Bank announced two rather remarkable new ideas.  Both involve at least one customer getting some money, although the amounts in question vary enormously. 

The first is particularly impressive when you look at the amount of money involved. They have launched a competition. All you need to do to enter the competition is take out a loan before the end of December, and you stand to win a prize of P1 million.  Yes, a whole million. 

There are a couple of conditions, of course.  You must borrow P30, 000 or more over a period of at least three years, and it must be one of Standard Chartered's No Mathata or Scheme Personal Loans. 

The only other catch - and it's not much of a catch - is that if you win, you must donate 10 percent of the million to a charity of your choice.

Yes, I suppose it's only going to benefit one customer and his or her family, but it's still the biggest competition price I've ever seen in Botswana.  Also, the obligatory chunk of cash going to a charity is a nice touch.

So where is that application form?

The other new idea is actually the one that I think is most impressive.  Something that's actually much braver than the P1 million competition, even though it involves a lot less money. Something that might actually benefit all of us. It's something I've not heard of before in Botswana: Automatic compensation!

Standard Chartered now pledge that any customer who calls their 24-hour call centre and does not get their problem solved within 24 hours will get P100 paid into their account.

In announcing this, the bank says that it is 'putting back the control of the client/service provider relationship where it should lie, namely with our customer'. I think that might be putting it a little strongly, but the idea is a sound one.  If they get something wrong and don't fix it quickly, they'll say sorry in a much better way than just saying it out loud. They'll give you money. Straight into your bank account.

There are several aspects of this that I think are worth considering. Firstly, they are introducing something like a Service Level Agreement. This sort of thing is common in other industries, particularly information technology.  There you get guaranteed levels of service, and very often penalties, when the supplier fails to meet them. It's a way to recognise that customers have rights and that they deserve a service in return for the fees they pay.

Then there's the encouragement this sort of thing offers to staff within the bank.  Standard Chartered aren't going to go around giving disappointed customers P100 without keeping detailed records of when this happens.  One of the details they'll obviously record is whose fault the problem was. 

Bank staff are really not going to want their name cropping up over and over again against these payments. There's going to be a healthy fear of this mechanism within the bank. At the end of the year, you can imagine the MD demanding to know which bank employee incurred the most P100 penalties in the previous 12 months. Quite an incentive, I say.

Lastly, I like this approach because it does seem to balance things a bit. Bless them, banks are usually very quick to punish us customers when we transgress. They are eager to write us nasty letters when we fail to repay our loans, overdraw or commit some other misdemeanour.

But this new idea changes that slightly. Now instead of just writing to us to tell us off, they'll be writing to say sorry and offer us a little cash.  This may seem like a small thing, but it does re-balance the relationship a bit.

Most importantly, this adds to the competition between banks. In the last few months, we have seen most of the banks competing for the lower income end of the market.  They were all trying their best to out-do each other in offering services to this under-serviced section of the market.

Now perhaps well see banks competing to sell us their products on the basis of the quality of the services they deliver, not just the mechanics like interest rates and bank charges. 

So congratulations to Standard Chartered for taking the leap and let's hope we see more of this from the others sooner rather than later!

This week's stars!

l Wapula at the Shell Filling Station in Kanye for 'excellent' service and being so cheerful and friendly.

Who deserves a treat?  Nominate someone for outstanding service and they could win either an Apache Spur meal voucher or a voucher from Stanbic. Our second birthday party is rapidly approaching, and the more people we can celebrate the better!
If you have any consumer issues and you think we could help please get in touch.  You can contact Consumer Watchdog by emailing us at watchdog@bes.bw, by post to Consumer Watchdog, P. O. Box 403026, Gaborone or by phone on 3904582 or fax on 3911763.  You can also visit our website at www.bes.bw and then click on the link to Consumer Watchdog.