Unfortunately, and I feel rather cheeky saying this, I disagree with much of what Patrick says.
His article commented on services levels from banks and seemed to be based on the general sense that banks are putting customer’s interests lower than they did in the past.
Actually I disagree with that. My feeling and the feedback we get from people who contact us is that banks are actually treating customers a little better than they did in the past. There’s obviously still a long way to go but I they are making progress.
Patrick makes a couple of specific comments that inspired me to comment. For instance he says that he has reflected on whether “banks are only out for profit these days”. Later he seems surprised that a bank’s “obligations to it’s shareholders are more important than it’s obligations to it’s many customers”.
Well of course! Commercial organisations are there for profit. That’s their only role in life, to make money for their shareholders. Banks, just like any other private companies aren’t actually there for the benefit of customers, they are there to reward the people who invest in them. That’s just the way of things in a free market economy.
Now it may seem curious for a column that’s here to talk about customer service to be saying this, that the profit motive is supreme but there is some logic in my madness.
I think it’s perfectly respectable to put profits and shareholders first. However this is of course best done by treating customers well. It’s not rocket science. Organisations that treat their customers properly, that give them good deals and respect their needs are the ones that are going to attract customers, sell things and make those profits I’m so keen on. These companies are the ones that shareholders will queue up to invest in.
I don’t care, and I don’t think you should either, that they are doing it “for the wrong reasons”. It doesn’t bother me that they treat me well (sometimes) because they think that this will make me give them more of my money to invest and to generate profits for them rather than me. So long as I get good treatment I’m fairly content.
Patrick also questions the contribution that banks are making towards national “development”. Well, they make a huge contribution just by existing and doing business. Not the least of these contributions is the corporation tax they pay. Most of their staff will also be paying income tax. Frankly anything else they do on top of this, whether it’s charitable contributions, corporate sponsorships or general good works is a pleasant luxury. But let’s be frank, they do all these things because they think it will attract more customers, ingratiate them with the powers that be and generally boost their profitability.
Before I get carried away, there are some areas where I think Patrick makes some excellent points. Bank charges in Botswana are ridiculously high. In almost all countries I’ve lived or worked personal banking is completely free, so long as you are in credit. I really resent being charged for every transaction, being charged enormous interest rates compared to the rest of the world and as for queuing…! Simply not good enough.
Also, as I mentioned last week, I do think that banks are often far too rigid. Of course I believe in having procedures and polices that govern how they work but there are times when we need managers to exercise some discretion. It’s not too much to ask long-standing good customers to be given a little flexibility occasionally.
However, back to the main point. Banks are commercial organisations that exist for one reason only, to make money for their shareholders and they shouldn’t be ashamed of that. I also think that we have no business criticising them for this. Yes, we should criticise them for a wide range of other failures but not for being what they are.
Part of the problem I see is that we still haven’t fully understood the principles of the free market. I don’t think we acknowledge that prosperity has always been greatest when the marketplace is free to all, where government steps back and allows nature to take it’s course and where profits are seen as a sign of success, not of moral failure.
Yes, there is greater variation between the rich and the poor in a free market economy. Yes, in a centralised, command economies like Eastern Europe suffered for so long, the variation is smaller but that’s just because everyone is poor. At least in a free market people have a chance to become prosperous.
Unfortunately for those who disagree with the free market concept and think that life would be better in some form of centralised, command economy, well, too late! The marketplace has been here since the very first cave man sold a dead antelope to his neighbour in return for an axe. It’s nothing new, it’s been with us since the beginning of humanity. We are, at our core, hairless, social, trading apes and the marketplace is our natural habitat. It’s what we are and every social experiment to construct something “better” has been a miserable failure.
Winston Churchill famously said that democracy “is the worst form of government, except for all the others”. I think the same can be said of the free market economy. It’s the worst form of economy, except for all the others.
This week’s stars!
- Anna, the receptionist at Department of Taxes for her fantastic telephone manner
- Mr FG Lekhau from Taxes for listening to a problem, finding a solution and then doing it!
- Debonairs Pizza at Kgale Hill yet again for fixing a problem so well
- Mr Price at Game City for friendly, helpful and courteous service