By Michael Baxter 29 Jul 2010 [1 Comment | 456 views]
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It is time for the British public to put their money where their mouth is. Today saw the first launch of a High Street bank in 100 years. And it offers all the services we have berated banks for not offering. But it comes at a price. Will the public be willing to pay that price?
Evolution works by failure. Evolution works by constantly experimenting, and the experiments that work are repeated, and out of these come both extinctions and population explosions. Evolution has ceased to function in the world of banking because failure is not allowed. Banks may say their service has evolved, but they are not using the word in its correct sense. And as a result their public is the loser.
But the question is this: if evolution had been allowed to work with banks, and in 2008 they had been allowed to fail, what would have emerged in the vacuum that was left? It is actually almost impossible to predict what New Banks version 2.0 would have looked like.
But now, despite the fact that banks required billions of government money in order to survive, we are seeing a new generation of banks evolve anyway.
Today Metro bank opened its doors in Holborn, London. As you know, Tesco and Virgin have plans for a network of High Street banks.
And while this column is a fan of the Internet, we would say that the Net sometimes feels like a force for making things worse. Does anyone like dealing with call centres? And the bigger the Internet brand, the harder the company is to deal with on individual basis. If you are a business with a gripe against Google, you stand no chance whatsoever of getting the company to listen to you. If you are selling a book over Amazon, and are not happy with the service – well, that’s just too bad. But does anything top the banks for making things less personal?
If you are of a certain age, you may recall a TV advert back in the 1980s for Barclays, portraying a nightmarish scene from the future in which some hapless individual battles with robots and computers when all he wants is “to talk to someone”. If you have seen the film Blade Runner, you may get a feel for the atmosphere created in the ad. In fact, it was directed by Ridley Scott – director of Blade Runner. See Barclays Blader Runner ad
It’s all a tad ironic, because these days Barclays is one of the worst offenders. A quarter of a century on and the impersonal world those ads prophesied seems to have come true.
And so it is that Metro will offer a branch service which is open 12 hours a day during the week, from 8am to 6pm on Saturdays, and High Street hours on a Sunday. It will be possible to go the bank and open an account within 20 minutes, have your new card printed on the spot. Local businesses will have a local business adviser who will be able to make decisions. But above all, the bank’s customers will be able to talk to someone, in person, and if they are regular customers, they will be able to talk to people they recognise from previous visits.
In short, a return to old-fashioned banking, with a kind of twenty-first century Captain Mainwaring in the manager’s office, but working longer hours.
There’s a snag. Service costs money.
Apparently none of Metro’s products show up in best buy, top ten tables. The bank does not vary the prices it charges customers according to their risk profile. This of course is precisely what people have been calling out for. But also it does mean, or so David Black From Defaqto has suggested, customers will be turned away from the bank.
And that really is the point. Banks have become impersonal beasts, in which all decisions seem to be made by computer. But this has resulted in cheaper banking. We long for a return to old-fashioned banking that puts the needs of customers first, offers a personal service, but at the same time follows twenty-first century practice in terms of trading hours. But in reality such a service comes at a price, and it remains to be seen whether we are willing to pay for it.
‘Some people will be turned away’ Well at long last! If we could really hope this bank may be in the vanguard of a return to commonsense values. Those who don’t have the means or ability to maintain a bank account SHOULD be turned away until such time as they have learned the skills and earned the income to be able to manage. When I was at school we had a school bank for us kids to put our savings and learn about how the system works. The cancer that has grown in our society is the belief that no matter what it is we should have an equal right to it irrispective of whether or not we have earned it or know what to do with it. Why save for a pensio when those who don’t get a better lifestyle than those who do. Why bother to work when those who don’t get handed everything they want. Maybe this will be ‘one small step for a man, one giant step for us all as a society!