Friday 29 August 2008

The Voice - Consumer's Voice

Dear Consumer’s Voice

I read your Buyer’s Guide in The Voice recently about buying personal computers. You advised readers not buy a computer from companies that advertise in The Advertiser, so my question is where would you advise someone to buy a laptop?

Just a brief correction. We didn’t say that you shouldn’t buy from companies that advertise in The Advertiser. What we said was you should “take particular care if you buy from a company that advertises in The Advertiser”.

We are obviously not saying that there’s anything wrong with all the companies you find in the Advertiser it’s just that every complaint we have ever had about PCs has been traced back to those who advertise there.

It’s perfectly possible that some of the companies there are perfectly respectable. However we know of two of them who were raided by Microsoft and the Police some while ago for allegedly selling and installing pirated software. They have apparently stopped this now and you’ll see that in their advertisements that they now offer Microsoft Windows for sale.

When buying a PC you must take care about a number of things. PCs are obviously technical and remarkably varied. The number of options available to you is amazing. That’s why you should consult a friend who knows about these things first.

That’s why you should also take particular care with things like the warranties that are offered by the manufacturer. That’s why we also recommend buying a PC from a well-known manufacturer. That way you are much more likely to get decent support if something goes wrong. It certainly doesn’t mean there will be no problems, it’s just that if there are, you’re likely to get them fixed.

As with everything else you might consider buying, the secret is to ask advice and to shop around. Also keep reading The Voice and call us if you have a problem.

An appeal

This week we are announcing the launch of a new series of charitable appeals. The Consumer Watchdog team have been very distressed to hear recently of several very sad cases that urgently need public support. We hope you will be as generous as we know you all can be and help these very unfortunate cases.

The cash-starved store

We were contacted last week by a rather unhappy customer who went to a well-known furniture store at the Station in Gaborone to buy a bed. She paid them a deposit and was keenly awaiting delivery when they informed her that the bed wasn’t in stock. Frustrated by this she told the store that she was changing her mind and wanted a refund of the deposit. So far so good. Of course she was perfectly entitled to do that. By failing to deliver her bed she was able to cancel the agreement and demand a full refund. Section 15 (1) (e) of the Consumer Protection Regulations states that when a deal is cancelled the supplier is obliged to return any deposits that have been paid.

So you’re probably thinking that the store refused to do so? Or perhaps they insisted that the customer was committed to the deal and had to accept the bed whenever they got around to supplying it? Perhaps they were going to commit her to some awful credit agreement that would bankrupt her?

No, you’re being unfair to the store. They were perfectly prepared to cancel the whole deal. They were perfectly prepared to refund the customer’s deposit. The problem was that they couldn’t because they didn’t have any cash. The store told her that she would have to wait for other customers to come and buy things for cash before they could give her the deposit back.

So perhaps you’re thinking that they could have written her a cheque? No, they weren’t permitted to do that. A direct transfer to her bank account? No, likewise.

So our first appeal this week is for the furniture store. Please go down to the station and take lots of cash and buy some furniture. That’s the only way our reader is getting her deposit back.

The illiterate stores

Illiteracy is a scourge in any nation. The inability of people to read and write affects their ability to get a job, to function in the modern age and to understand what is going on in the world. Those of you reading this article are very lucky to have the ability to read it. Think how difficult life would be if you couldn’t read.

Just out of interest I wonder how many organisations have considered the fact that many of the contracts they require their customers to sign might actually be legally invalid? Section 17 (1) (g) of the Consumer Protection Regulations says that a supplier has committed an “unfair business practice” if they take advantage of a consumer’s “inability reasonably to protect his interests by
reason of … inability to understand the language of an agreement presented by the other party to the transaction who knows or reasonably should know of the consumer's inability”

In other words if a store encounters a customer who obviously only speaks Setswana and they get them to sign a contract that is in English (and they ALL are) they have been very bad children and deserve a smacked bottom. Wouldn’t THAT be fun to watch.

Actually our appeal is not for the unfortunate victims of this misbehaviour. Our appeal is for the poor stores that can’t read. So many of them seem to be functionally illiterate. They can’t read the law, they can’t read the letters of complaint from their customers and they most certainly can’t read the letters from Consumer Watchdog, even when they are written in very simple terms and in very big letters in Mmegi.

So let’s all get together and teach stores how to read. Let’s start sending them letters explaining their obligations and let’s start introducing them to the law.

An appeal for enforcement

Finally it’s that same old appeal that we issue over and over again. We need enforcement. Despite what you might think there are authorities out there that have not just the legal right but the legal responsibility for enforcing the law. No, not just the Police although they do seem to have forgotten much of what they can do. I wonder how many police officers of the rank of sergeant or above realise that they are “authorised officers” empowered by the Food Control Act to enter any premises where food is sold and examine the quality of the food? They can also seize any foods they suspect of not meeting the requirements of the Act.

Then there is the Consumer Protection Unit. The Consumer Protection Act created this Unit and also gave them certain responsibilities. No, not rights, powers and opportunities. No, it gave them responsibilities. Obligations. Duties.

The Act lists several of these duties but my favourite is the last one. The Act says that they must “do all such other things as may be necessary to protect consumers from purchasing or otherwise acquiring substandard goods or services or from being otherwise exploited.”

Clearly they need help. Our final appeal is for the public to help them do this. If you contact them please visit our web site first where you’ll see a Shopper’s Guide to the Consumer Protection Regulations. That way you can explain to them what they should do for you.

This week’s stars!
  • Raymond from FNB for helping a customer when she lost her cards.
  • Agatha from Bank Gaborone for taking responsibility for a problem and helping to get it fixed.

Friday 22 August 2008

The Voice - Consumer's Voice

Dear Consumer’s Voice

I was recently at a restaurant in Gaborone and when I paid using my debit card they asked me to give them my contact details in a form on the back of the bill. This asked for my telephone number, address and ID number. I was worried about giving away these personal details. Do you think I should have given them?

No, I don’t think you should ever give your personal data to anyone you don’t know.

Of course we all understand that stores and restaurants lose money because some customers are crooks. We were told recently by one major store in Gaborone that they lost over P250,000 last year just because of dishonoured cheques. That was before the money they lost to people who were using stolen debit and credit cards. You might think this has nothing to do with you and me, the honest customers, but remember that it is the honest customers who end up paying the price for the dishonest ones. The store will simply put up it’s prices to cover the losses they make from fraud and theft and who then pays those higher prices? You and me.

Stores are entitled to take certain measures to ensure you are who you say you are but I think that recording your ID number is going too far. I think it’s reasonable for you to show them your ID or your driving licence, in fact anything with your picture and name so they can be certain you are genuine but allowing them to record the details is too much.

With someone’s ID number and other personal details a criminal can easily get up to mischief. We heard recently of a case where an employee of a company was taking copies of customer’s credit card and personal details and was feeding them to a large credit card fraud ring. Lost of people came close to losing lots of money.

So be careful. Help the store by proving your identity but don’t leave the proof behind!

Criminal complicity?

There’s a thin line between criminality and complicity.

I’ve been working recently with an organisation that, for reasons that will be obvious, I cannot name. The objective has been fairly broad and rather ambitious. They want to become more productive, more efficient and to have happier customers. Very sensibly they have recognised that to do this they have to very carefully examine the way in which they do things. They are going through all of their internal procedures, adjusting them, improving them and every so often, abandoning them.

One of their key problems is that they often overpay their staff. Sometimes they fail to pay their staff at all. Sometimes they continue to pay their staff for ages after they leave. They’ve been known to continue paying staff who have resigned or who they’ve fired, even staff who are dead and buried.

As part of the review I was recently in a meeting with one of their managers and we were discussing our concerns about the level of mistakes and even fraud that were behind these overpayments. I suggested that everyone in the organisation had a responsibility to look out for mistakes and fraud. He disagreed. He said “I’m not an auditor, you know!”

He’s wrong. Everyone who works is an auditor. Everyone in a company has a responsibility to prevent fraud.

If I see a woman being raped outside my office is it acceptable for me to say to myself “I’m not a policeman, you know”, ignore the crime and carry on surfing the web? No, of course not.

So why is it acceptable for people to remain quiet if they realise that there is fraud in their company? Why is it acceptable if they realise that potential profits of a company, which is perhaps next year’s pay rise, are disappearing?

Ask yourself this. If you’re walking round a supermarket and you spot someone taking items from the shelves and hiding them in their pockets, what should you do? What’s the right thing to do? Should you walk away, ignore it and think to yourself “I’m not a cop, you know?” No, I don’t think you should. I think we all have a moral obligation to help stamp out crime. I also think that it’s a form of what Adam Smith described as “enlightened self-interest”. If I can help a store cut down on shoplifting then I can help them keep their prices down because remember that stores will just increase their prices so they can recover the money they lose to theft. I might even be helping to save myself some money.

I’d go further. I think that if we don’t help to stop crime when we know it is happening then we are complicit in that crime. If I know that there is fraud in a certain organisation and I don’t alert someone in authority in that organisation then I’m helping it to happen. If I don’t alert the police to a crime then I’m partially to blame for it not being stopped. If I don’t tell the store about the shoplifter then I’m actually helping him or her to commit a crime.

Of course I’m not in the same category as the fraudster, the rapist or the shoplifter but my crime is one of omission, not commission. You can help a criminal by not doing something as well as by directly helping him. We are, you could say, all auditors, all policemen and women and we’re all guardians of our national security and safety.

So why do we, as a community, allow stolen goods to be openly sold and do nothing about it? We all know by now that certain cellphone stores are selling stolen phones. We know this, we really do. We know those cellphone stores are selling what are politely called “grey imports” that are often in fact second hand but are being sold as new. We all know that a particular store at Molapo Crossing is selling illegal, pirated copies of blockbuster films. Yes, of course we know they’re pirated, half of them haven’t been released yet. When we watch them they have oriental subtitles, the film quality is awful and the sound is dreadful. We know they are illegal and by continuing to buy them we are complicit in crime. By not calling the police and the City Council we are helping criminals to do their sordid business.

I’d go further still. I would say that by not going out of their way to find these crooks, our law enforcement agencies are also complicit. We all know who the crooks are, surely the authorities must know too? Are they perhaps so removed from real life that they don’t know what’s going on? Perhaps they just can’t be bothered?

I’ve tried very hard to think of a way to link this issue to Democracy but I’ve failed. However I think that tolerance of crime is the direct opposite of Development, Dignity and Discipline. Do we want to be seen as supporters of crime or a nation that upholds The Law?

You can judge a country not by it’s government, it’s culture or it’s history. You can judge a country by the nature of it’s people. I wonder whether we want to be seen as a nation of decent, law-abiding good citizens or a nation of criminal accomplices?

Friday 15 August 2008

The Voice - Consumer's Voice

Dear Consumer’s Voice

In February this year I bought a Nokia 6111 cellphone from the Orange shop down at Game City.

It soon started giving me problems with the battery so I took it back to them. After a week they told me that the phone had a battery problem. The shop assistant told me that the phone was “dead” and that the warranty on the battery was only 3 months. I was surprised because they hadn’t told me that the battery was covered by a different warranty from the rest of the phone and that they couldn’t repair it. I therefore had no option but to buy another battery.

However I then took the phone to another repair centre who told me that there was nothing wrong with the original battery. I am now faced with a bill for the repairs to the phone as well as a new battery which I think was unnecessary.

Since all this the charger for the phone has broken so I can’t use it at all.

What can I do?

This sounds like a comprehensive failure by this store. The first issue is the warranty. Did the store explain that the battery was covered by a different warranty to the rest of the phone? Section 17 (1) (e) of the Consumer Protection Regulations says that it is an unfair business practice to disclaim the “warranty of merchantability and fitness for use, unless a disclaimer is clearly and conspicuously disclosed”. Unless they made it perfectly clear that this was the case before you bought the phone then IT IS NOT THE CASE, simple as that.

Secondly they failed you again by telling you that the battery was dead if it wasn’t. Section 17 (1) (b) of the regulations says they’re in major mathata if they say that “a part, replacement or repair is needed when it is not”.

Finally it seems like this phone just isn’t of “merchantable quality” as defined by the Regulations. The store has therefore failed “to meet minimum standards and specifications”.

We’ll contact the store for you to see what they say for themselves. We’ll also contact both Orange and Nokia to see if they have anything to say as well!

Dear Store Owners

As you may have seen in Mmegi last week we wrote an open letter to the President regarding store credit. No, not the President of the local tyre factory, the President of the Student Bar or the President of the local chapter of the Association of Crooked Store Credit Providers.

No, the President of Botswana.

Those of you who spend your illicit profits from store credit on alcohol will know that The President has recently announced a 70% levy on the price of booze. This is meant to curb excessive consumption, to price certain communities out of bad behaviour and maybe even to make our roads a little safer.

Whether you agree with the approach he has adopted or not at least he’s doing something. Even though this is going to affect me personally I do have to acknowledge that action is better than words. It reminds me of the when I was learning to drive. My instructor taught me that it is almost always better at a junction to take a decision and stick with it than to do nothing. The worst thing you can do is to be indecisive and end up causing traffic jams.

The thing that struck us about this new levy is the piece of law that is being used to introduce and enforce it. It’s that often overlooked piece of legislation called the Control of Goods Act. There’s a section of this Act that allows the relevant Minister to apply a levy to alcohol, broom handles and silly hats if he feels the need.

In our open letter to the President we praised him for using this law to do something. This law has been under-used and it’s nice to see it being taken out of the cupboard for a change.

However, what we pointed out to His Excellency is that there are other parts of this law that he should consider using in the future. Specifically there are the Regulations that were passed shortly after the law. The Control of Goods (Marking of Goods) Regulations were first enacted more than thirty years ago and cover (you might need to sit down for a moment and take a few deep breaths) store credit schemes.

Specifically these Regulations state that when something is “offered for sale” on credit the seller must disclose, amongst other things, “the total amount to be paid by way of deposit and instalments”.

Let’s go through this in simple terms that don’t need a lawyer to explain them. The Regulations say that these details must be disclosed when a product is “offered for sale”. Not during the heavy-selling process when you refuse to take cash, not during the form-filling, not after it has been sold when things have gone wrong. No, when it is offered for sale. That means when you advertise it. That means when you place a poster in your window to tempt passers by to come in and leave their money behind. That’s when the law demands that you disclose “the total amount to be paid by way of deposit and instalments”.

Now we know that you all know about this. We know this because we wrote to you all about your failure to abide by the law in October of last year. We wrote to you again two weeks later. We wrote about this in Mmegi at the same time. We’ve spoken to some of you about it since. Every single store that sells on credit knows about this and has no excuse for not taking action.

So how many of you did something about it? How many stores thought that the law was worth respecting?


Ellerines contacted us very soon after our first letter and told us that they were appalled to discover that they hadn’t been abiding by the law and promised to fix it as soon as possible. Next time you pass by a branch of Ellerines check out the posters in their windows. As well as the cash price they disclose the full credit price as well. Beares did the same thing. Both Ellerines and Beares have shown that they respect the laws of Botswana and that they respect their customers.

The rest of you have failed to do so. Clearly this can’t be because you don’t respect the laws of Botswana, can it? It can’t be because you don’t respect your customers, can it? It can’t be because you think the people of Botswana are just cattle waiting to be processed, can it?

It can’t be because you don’t want your customers to realise the truly excruciating levels of interest you charge, can it? It can’t be because you don’t want your customers to know about the ridiculous compulsory insurance schemes you make your victims sign up for, can it? You know, the insurance schemes that sometimes cost nearly as much as the product itself? The insurance schemes that actually don’t insure the customer but in fact insure you, the store?

No, we can’t believe that you would be so cynical. That’s our job.

What we think you need to do is quite simple. Obey the law. The risk you run if you fail to do so is significant. Already the alcohol industry has been the focus of the President’s attention. Do you want to be next?

With very little respect and virtually no regards.

The Consumer Watchdog team

This week’s stars!
  • Brian from Apache Spur at Riverwalk in Gaborone for being terrific at his job.
  • Minkie from First Card at FNB for being really helpful with a problem and going out of her way to try and sort it.

Friday 8 August 2008

The Voice - Consumer's Voice

Dear Consumer’s Voice

Should I play lotteries on the internet? Are they a scam?

No, you shouldn’t play online lotteries. Are they a scam? Yes and No.

As we all know many countries have national lotteries. These often raise money for good causes and get huge public support. Millions of people buy cheap lottery tickets and there’s huge publicity for the results and the winners. The prizes can be enormous, often millions of dollars or pounds.

However the trouble with lotteries is that they are based on our failure to truly understand mathematics. The UK lottery is fairly typical. You have to select 6 numbers between 1 and 49. If the 6 numbers you select are the ones drawn then you win the jackpot. Simple as that. Somehow the odds seem fairly good. Six out of 49 isn’t high but it’s more than 1 out of 49 isn’t it?

On the contrary. Do you know how many different ways you can choose 6 numbers from 49? 13,983,816. The likelihood of you choosing the correct 6 numbers is almost 1 in 14 million. If you enter such a lottery every week of your life you’re not going to win the jackpot. If you entered it every day you still wouldn’t win. Lotteries cover this up to some extent by having a range of smaller prizes. If you only get 5 correct numbers you get a smaller return. If you get 4 you get an even smaller prize.

The best way to view lotteries is to look at the “expected value” of your ticket. Typically people who buy lottery tickets will, on average, get only half of their money back. Entering lotteries is just a very efficient way of throwing money away.

Then there are the online versions of these lotteries like This company buys UK and Euro lottery tickets on your behalf and send you a scanned copy of your ticket as confirmation. However you have to pay £3 for a ticket that costs only £1 in the UK. You’ll get even less of a return if you have to pay them a 200% mark-up on the ticket price.

So no, it’s not a scam, it’s just foolish.

Dear Mr President

Many congratulations on the first few months of your presidency. Consumer Watchdog was impressed by the emphasis you placed from the beginning on the 4 Ds but particularly on Discipline. We believe very strongly that our nation needs a firm dose of this rare product and it was refreshing to see it coming from the top.

I am particularly delighted to see the effect of your demands on the Public Service. It’s a huge task but already we think that the public are beginning to see improvements. All anyone has to do these days when dealing with a sleepy public servant is to mention the word “Discipline” and things speed up. No public servant wants you turning up at their office unannounced if you’ve heard that they are lacking some of that crucial D.

I also think that the rather hands-on approach you have adopted is deeply refreshing and a great example of true management. The word “management” comes from the Latin word manus which means “hand”. By definition the only true type of management is hands-on. Anything else is just having an office.

However I confess that I’m not 100% convinced about things like the forthcoming application of a 70% levy on alcohol prices as I’m really not convinced it will work as your advisors may have suggested.

Despite my misgivings I hope to be proved wrong. I hope that, as a nation, we do start to behave with more discipline regarding alcohol and it’s consumption. Personally I think this is more likely to come from greater enforcement of existing laws than trying to constrain consumption. If, for instance, drinkers truly believed that there was a real chance that if they drove while incapable then they would be stopped, prosecuted and banned from driving then I think they might be less likely to do it.

What most interested me was the law your team are using to implement this new levy. According to the press release the levy is being introduced under Section 3 (2) (d) of the Control of Goods, Prices and Other Charges Act. This states that the relevant Minister may introduce regulations governing prices including “a levy on such items of goods as may be specified and the manner of utilizing such levy”. So far so good.

So why are other regulations that are already there to protect us being ignored? Is your Public Service going to be as undisciplined with your new alcohol levy as they are with the existing regulations?

What does it take for the public to demand that they enforce the existing regulations?

Section 6 of the Control of Goods (Marking of Goods) Regulations says that when something is “offered for sale” on credit the seller must disclose, amongst other things, “the total amount to be paid by way of deposit and instalments”. In simple terms the total credit price has to be displayed in an advertisement when an item is advertised.

This is perfectly simple, perfectly easy to explain and would costs stores virtually nothing to include in their advertisements. So why don’t they? Why do they ignore the law and disrespect their customers in Botswana?

Is it because they don’t know about the law? No.

Last year we wrote to all stores outlining their legal obligations. We then wrote to them a second time. We published the letters in Mmegi and on our web site. We wrote to MPs and the Minister of Trade & Industry about the situation.

What happened?

Only one store that sells items on credit responded to us. To their great credit Ellerines responded, expressed their regret at innocently doing this and have subsequently changed their advertising so that it now shows the full credit price. Beares did the same. We would like to commend both these stores to you for their prompt action and for understanding that there are laws in Botswana that must be obeyed.

No other store responded positively. One said they were consulting their South African head office but we heard nothing more. The rest just ignored us.

The trouble is that Consumer Watchdog has no real power. We have newspaper columns and media contacts but no legal powers. The powers rest with the Public Service and they are simply not using them. Surely they can’t claim ignorance, can they? Surely the Public Service is disciplined enough to know it’s role and the tools it has to exercise that role?

Mr President, the people of Botswana are being badly let down by their Public Service in this area. The consumers of Botswana have excellent protections under the very same legislation that you are using to try to constrain alcohol consumption but these protections are being comprehensively ignored by the very people employed to enforce them.

We call upon you to ask the Ministry of Trade and Industry to start enforcing these laws with the same level of commitment and energy that they will no doubt adopt when applying your levy on alcoholic beverages.

Of course we cannot suggest that store credit kills people like drink-driving or alcohol-fuelled murder-suicides but many, many people end up abused, confused and poor because of the operations of the unscrupulous stores that sell on credit. This destroys families and ruins people’s hopes, dreams and aspirations. This is genuinely causing irreparable harm to our development as a nation.

We, as consumers of Botswana, implore you to take action to stop this, to help the people of Botswana operate free from credit abuse.

With great respect and regards

The Consumer Watchdog team

This week’s stars!
  • Toro and Dube from the butchery at Pick N Pay at Molapo Crossing for very friendly and helpful service.

Saturday 2 August 2008

The Voice - Dear Consumer's Voice

Dear Consumer’s Voice

I went to a bar in Palapye and they had a special offer on Carlsberg beer. If you bought one bottle they would give you a second bottle free.

I thought this was a very good offer but when I got the bottle of beer and the free second one I noticed that they both had an expiry date in June this year.

What should I do?

Take them back. Demand that the owner or manager of the bar gives you your money back immediately. If they refuse feel free to tell them that they have broken Section 12 of the Food Control Act which states that beer must have an expiry date and that it the seller must abide by it. Anything sold after the expiry date “shall not be regarded as marketable or fit for human consumption”.

Any store that ignores this is liable for “a fine of P1,000 and to imprisonment for 3 months”. Better still if they ignore the warning and continue to sell expired stock they may face “an additional fine of P500 and imprisonment for one month for each day that the offence continues”. If they continue to sell dodgy beer for a month they might not be seen again for years!

Consumers have to be very vigilant when buying food and drink. OK, expired beer probably isn’t going to kill you but things like chicken, pork and seafood have to be treated very carefully. Hundreds of thousands of people in Africa die from food-poisoning every year and a lot of this comes from badly stored food.

As consumers we need the authorities to be much more aggressive in policing food and drink outlets to make sure that they know their obligations and abide by them.

Update: We did a little bar exploration following this complaint and found that the same expired beer was being sold in bars in Gaborone as well. We’ll be tracking down the distributors and seeing what they have to say for themselves. We’ll keep you posted.

Have a free lunch

I’ve gone on repeatedly in this column about how there’s no such thing as a free lunch, meaning that people can’t ever really expect to get something for nothing. The free blankets offered as an incentive when you buy a set of furniture aren’t free at all. The store included the blankets in the price of the furniture in the first place. You’re paying for them whatever you do.

So just to break the rules we’re going to give stuff away this week. Nothing physical, better than that, better than a free t-shirt, better than a baseball cap, better than a corporate rucksack.


This week it’s the idea give-away. These are ideas that many organisations can adopt with little investment, with only a little effort and that we think may bring significant returns.

Save The Planet Discounts

We’re running out of electricity, only a couple of years ago we had no water and soon we might even run low on basic foods. It’s all doom and gloom and whether we like it or not we all have to cut down a bit. It’s in our interest to do this for many reasons. It’s the environmentally friendly thing to do, it’ll help reduce waste and, most selfishly of all, it can save us money.

But why don’t the utility companies, the ones that deliver us our electricity and water encourage us to reduce our consumption? I don’t mean with encouraging advertising campaigns, I mean something practical, a real encouragement to reduce our consumption?

Why don’t BPC and the others give money back to those consumers who reduce their consumption the most? They have the technology and the information to do this. They know how much power we all used last month, last quarter and last year. I think it would be a real encouragement if at the bottom of our power bills they added a line that said something like “BPC has calculated that you used 10% less power last month than you did in the same month last year so we’re knocking off 10% of your bill this month”. That would be a real incentive don’t you think? We’d be getting money back to reward us for following their advice on saving power.

It would reward the conscientious, power-saving, patriotic customers for doing the right thing. The really interesting part would be if they also did the opposite. Add an alternative comment on the bill that said “You used 10% more power last month than you did in the same month last year so we’re adding a 10% penalty to your bill. Stop wasting power!”

It’s all very well asking people to do the right thing for the right reasons but why not give them an incentive in the pocket as well?

Focussed rewards

This one is for banks but it could also be used by insurance companies, micro-lenders, even the stores that sell on illegal credit (if you can’t remember why some of them are illegal check out our web site for more details).

Banks keep track of everything their customers do. Every time they put money in, take money out, move money around, every time they pay a bill, fail to pay a bill or pay a bill late. They must have amassed vast quantities of data on us, our spending habits, and, most of all, whether we’re good customers or not.

I read a report some while ago about a bank in Portugal who had started to analyse their data in some detail. They came up with some interesting results. They found, for instance, that they could predict which customers were going to leave the bank and take their money elsewhere. One of the key predictors of customers leaving was that they would always, in the 2 or 3 months before stomping off in a huff, clear their credit card bill rather quickly. The bank then set up their technology that it would alert them when a customer started doing this. All it took was a phone call from a senior manager to sweet-talk the customer, address their dissatisfactions and send them a box of chocolates and they could prevent the loss of a valuable income-creating customer.

I think we should begin to expect banks here to do the same. I want to see banks focussing special offers on the customers that really deserve them. Instead of offering us all the fancy new accounts, the cheap loans and the gold credit cards why can’t they be more focussed? Offer those customers who have never defaulted on their loan repayments a lower interest rate on their next loan. Offer the customer who always pay his credit card bill promptly every month a reward. The customer who never exceeds her authorised overdraft limit should get a prize.

Yes. It may seem patronising but why don’t banks reward the good customers rather than treating everyone the same. There’s no point in being all politically correct about it, some customers are better than others so banks should treat them accordingly.

Above all I think I want to see my bank spending the profits they’re making from my overdraft by using their “intelligence” intelligently and I think we should all expect the same.

Free ideas?

The key idea is for an organisation to use the information it has to maximum advantage. It is, after all, why they capture it, isn’t it? Start converting the data they have into valuable information and then, if they are courageous enough, into knowledge and then into action. They’ll become better, more productive organisations and their customers will get better, more flexible and cheaper services.

This week’s stars!
  • Kabelo Johannes from the Ministry of Finance and Development Planning who, we are told, is a true service star