April 8, 2009

Banks can't survive without customers

How many times have you go into a bank and being treated like you are begging money from them? I'm not talking about the feeling that you have when you are asking them for a loan but this is when you want to take out your own money either some money for your everyday use or cashing out the fixed deposit that you kept with them. I read in one of the blog I follow, the writer thinks she was given second class treatment when she wanted to withdraw her fixed deposit in contrast to if she wants to deposit money into her account there. In short, if you give them money, the bank will roll out the red carpets and if you want to get back the money, they will try to resist that as long as possible. A minute more of that money in their hands, they can compound a few more dollar of interest.

Last week, I was at a talk somewhere regarding how much banks needed customers. I have been dealing with bankers since the day I become a lawyer. Some of them I kept at arm's length and some become fast friends. Some are my age or younger which can be considered the younger set with different ideals than those who has been in the banking system for years. I can talk 'finance' with them as if I am one of them. My Masters degree on Islamic finance also help. So, in short, I always know when they really want to be friends or just meeting me for the money I might have in my hands (not as if I have that much, but some of the clients on my stable do have the cash). Make no mistake, there are those who becomes fast friends of my partner or me or both of us but some are just 'friends' when they think they can get something out of the relationship.

That saying of banks not being able to survive without customers were said by a banker. He was lecturing in one of my Islamic finance class, and there were a lot of bankers in the class. Some were too jaded and believe customers are there just another numbered account which they had to take care of. Some do understand the concept but I believe most of them who believe are still new in the banking system. Give them a few years, then all will change their tune. That is the problem with the financial industry. They really believe in the SYSTEM. Try to change it, then you will be considered as an outsider who do not understand the concept of economy. If the system was really good, why did banks fail? I don't think I need to delve into that facts as there are a lot of websites and blogs dedicated to that specific subject.

So, people's savings are dwindling and people's confidence are fragile. They actually do not know who to trust anymore. If these people do not keep their money in banks will bank be able to lend anymore? Will there even be an economy? Too many people are predicting the doom and too little are solving it? The problem that I see is the economy that you see is the only one everyone knows since after the World Wars. So, the banks keep on surviving and the benchmark that we have is the one that we are comfortable with. So, for now, as the banks are surviving on your money, maybe they should think about you too other than themselves.


MechApe said...

Banks are made indispensable part of the socioeconomic system ruling the world.

Banking backed by the goverments and more so by the ideological indoctrination which was upon us for a long time. It is the pinacle of capitalism to alienate capital from the labor, this system proved to be the most efficient as to the rate of exchanging new ideas, inventions e.t.c.
But I have a feeling that financial capitalism will need to change soon in order to survive they need bring back the trust which is rapidly vaining.

Clarisse Teagen said...

Possibly that the system is far complicated, that people don't really understand what's going on . .
There should possibly be some other way.

Ratty said...

I agree that the banks could begin thinking of their customers a little more. Here in the US, it's not only the banks. Every large business has been treating their customers as bothersome thieves. It seems they think that will keep people coming back. It was working, until now. Maybe now they'll begin to reconsider this behavior.

Calvin Soo KJ said...

gosh....i hope it's not the bank i'm currently working with. but its sad.....in the banking industry, there is no such thing as equal service. correct me if im wrong, banks give special treatments to big depositors and not the small ones. not just the banks, most businesses do. and yes, banks need customers. without them, we have no business, and i have no salary. that's why i always believe, all customers whether big or small must be treated fairly. and it all depends on each individual staff. the management has no control over this.

kruel74 said...

MechApe - Yes, change is inevitable

Clarrise - You never know until you try

Ratty - There's always hope

Calvin - Sorry to say all bankers I meet from top to bottom usually have the same attitude

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