Old Skool Banking - Potential Business Opportunity?

asc99c

I personally think the banks do an amazing job of customer service. Usually, if you need to speak to someone about something, something has already gone wrong. For me the interesting bit is that I haven't spoken to anyone at my bank in over two years. Each month I'm paid by my employer. The money appears in my account, and shortly afterwards my mortgage and all the other monthly bills come out, all automatically and almost flawlessly. When I need cash, I can get it where ever I am in the world (anywhere I've been anyway) from any ATM. Even when my Grandma hands me a cheque, they've now got OCR machines that recognise the details and give me a receipt with a photo of the cheque.

The last time I spoke to someone at my bank was them ringing me to ask if I was in Russia, since someone had tried to use my credit card there. I rang them back as I never feel too comfortable speaking to them in any detail when they've rung me. They confirmed it was the bank who had called, cancelled the transactions, and reissued the card. The statements never showed any sign of trouble.

Old school customer service was never very good. You had to get time off work since banks opened late and closed early, and you could forget visiting on Saturday. The banks have done such a good job of embracing technology that your old skool bank would only attract people unwilling to use new technologies.

LongTermLurker

ESKIMO wrote: »

My interest was recently aroused by watching Mary Poppins

I'm afraid she's never managed to arouse my interest, but each to his own

LongTermLurker

(disagree - I think!) I think I tend to agree with most of the other posters. Here's my thoughts:

1. I choose bank services in the same way I choose all other services, which tends to be a combination of cost, customer service, quality of product, convenience, reliability and range of products and/or service and perceived value for money (cheapest doesn't always win). The order of preference varies depending on how I weigh them all up.
2. I rarely visit a bank and phone them up almost as rarely. If I could avoid visiting or talking to banking staff, I would. Not because I'm antisocial, but I am a control freak and if I can do everything myself (i.e. online) I will do.
3. However, when I do have to contact them, I want them to be efficient, polite and helpful.

So what I want is a bank with a solid background, with a range of accounts to suit my needs, paying competitive, if not the highest, rate of interest. I don't want to wait endlessly on the phone listening to classical music, not even once every 6 months, and I want the person that answers to be profficient, efficient, polite and knowledgeable. I've recently found that I can get most of what I want at First Direct, and Halifax come a close second. Neither meets my long term saving and investment needs, but for pure banking, I think they're both hard to beat (Howard apart).

As for cups of tea and warm handshakes, I honestly don't have time. If I did want a branch based bank, the most important thing they could offer would be late night and weekend opening - the "old skool" of 9 - 4 Mon to Fri is totally useless to me - I have to work for my money.

(edit - I think your poll has too many options - I chose "reasonably disagree" because I'm sure there's an opportunity with some customers, but I don't think the majority of customers would be bothered about extreme levels of "bowler-hatted" service)

ESKIMO

LongTermLurker wrote: »

I'm afraid she's never managed to arouse my interest, but each to his own

Oh dear.. i should have seen the inevitable connotations and inuendos coming!

Voice of an angel.

ESKIMO

LongTermLurker wrote: »

As for cups of tea and warm handshakes, I honestly don't have time. If I did want a branch based bank, the most important thing they could offer would be late night and weekend opening - the "old skool" of 9 - 4 Mon to Fri is totally useless to me - I have to work for my money.

I understand that completely, but it depends how you value 'money' i suppose. I look at it from the perspective of every penny counts. What i dispise is other people simply 'toying' or 'grooming' my savings. I don't appreciate that. I look after every penny as if it's my last.

I like the common approach, same level, same speaking terms, i don't want to have to put the effort in being pedantic and speaking in monetary terms left right and centre - i do far too much of that in my own job for my liking.

I just want it to be an effortless 'off the cuff' come 'mutual' conversation that respects my investment and informs the bank that i value money. I value just how hard some people in the world have to work to earn just a tuppence or two.

I don't like being talked down to or being 'besotted' with 'fancy' jargon which very few financial institutions have a poor grasp of. - In my own personal experience. (Next time you go into your bank quiz your 'customer service adviser' about 'gross and net tax'. My experience of them is that many of them are young and naive. Hence why i always try to deal direct with the bank manager!

I expect quick-fire instant answers, not someone who then asks a colleage or 'someone who might know the answer'.

LongTermLurker wrote: »

(edit - I think your poll has too many options - I chose "reasonably disagree" because I'm sure there's an opportunity with some customers, but I don't think the majority of customers would be bothered about extreme levels of "bowler-hatted" service)

I respect your choice. However, the point is that WHY should we have to continually put up with financial institutions offering diddly squat on our savings in comparison to what they then make on top - only to be bailed out (at my cost) as a taxpayer!

I'm not contributing to the economy to 'bail-out' or 'prop-up' a bank (which effectively pays their wages) so in respect one could 'infer' (based on the FSCS and credit-crunch) that the 'private' finanical sector is in actual fact a publicly financed and facilitated good-for-nothing bunch of human beings that are only 'merely' human and therefore mortal. Hence we all make mistakes.

The point i'm making is that financial instituitions have lost touch with the real world. Decisions made in back-office hedge-funds are mostly purely speculative hot-shots. Throw of a dice if you will. No one can predict the future. One can only make an 'informed' judgement and decision based on past/previous occurances. Which, in a nut-shell is aka an 'educated guess'!

LongTermLurker

asc99c wrote: »

Old school customer service was never very good. You had to get time off work since banks opened late and closed early, and you could forget visiting on Saturday. The banks have done such a good job of embracing technology that your old skool bank would only attract people unwilling to use new technologies.

I actually hadn't read your post before I wrote mine - clearly, we both have the same problems with the old banking format - the reason I went with Halifax Building Society was because they opened Saturdays - a breath of fresh air. It made me cringe when I heard (Natwest?) saying "we've listened to our customers and you told us you wanted Saturday opening".

WAKE UP, TRADITIONAL BANKS - it was happening 20 years or more ago!!!

ESKIMO

The point though, is that the service you 'think' you are receiving is in actual fact already being dictated to us. It's already factored into the equation of an 'all-inclusive' service!

'FREE' Banking, 'FREE' Deposits, 'FREE' Balance Updates, 'FREE' Transfers and Withdrawalls, 'FREE' Online Banking, 'FREE' 'Advice' etc

People think it's 'FREE', but we are all paying for a service that many of us are not receiving. As i say it's all factored in. I know what i'm trying to say, it's just very difficult to try to explain in writing, but i'll give it my best shot.

You are all missing the point here. They are dictating the level of customer service we receive. You are already paying for the service upto the hilt. Look at the difference in profit margins made on savings (deposits).

E.g.:

Say Bank of 'Lunacy' attracts it's capital investment (through customer deposits) with an advertising campaign of 2.5% AER. Right... lets assume they attain (and retain) 1,000,000 - 1million (1m) customers each investing on average £1000 (£1k). Ok, now for the maths, 1m x £1k = £1billion (£1bn). [Still with me?] Ok, so far so good.

1bn at 2.5% AER equates to £25,000,000 (£25m) in interest.

Ok forgetting the fact that some customers may make further deposits and/or withdrawalls - for arguments sake, let's say that they are 'tied-in' for a minimum of a year and the average capital of 1bn remains as a constant.

The bank knows it MUST make a minimum of 2.5% to 'break-even' (if you like) to commit to it's obligation in/of interest payments.

So what happens is that a big insurance conglomorate comes along (often being underwritten by 'other' banks and/or insurers) and underwrites this said 'Lunacy' Bank effectively 'guaranteeing' the 1bn/25m interest obligation.

However, the bank immediately says; "wayhey, weve just aquired or 'guaranteed' £1bn worth of capital investment, now we need to flogg it as quickly as possible to get the ball rolling." - It then just passes the parcel around to get it's profit. 'Deal first, ask questions later.'

FACT: The capital IS a currency which is traded (exchanged, sold and bought-back to and from other financial institutions.) In the process the numbers 'grow' because each institution tells another what it intends to do (usually with a buyer already lined up).

So you have got a long-chain of 'exchanges' with umpteen dozen middle-men strategically situated in this dodgy chain of 'grooming' which is effectively 'playing' with the money in their own way. A big 'gang-bang' if you like (with everyone taking their share of the b***h) [ - appologies for the graphical illustration, it is not meant to offend anyone, purely just a 'simple' physical and metaphorical interpretation of it's 'kinetics'. - I would just like to also disclaim (in advance of any 'opposition' to my post that i totally don't condone rape or any other crime in anyway, shape or form. - Criminals are cruel, cold, calous and calculating - heartless individuals whom show no sence of remorse, empathy, compassion, sympathy or understanding to their victims or to that of their families.] - I hope i have made this clear.

The problem is the difference from the 'attractive' rate of 2.5 or (what we see in our economy today with 5+%) to the 'actual' rate which is more like somewhere between 0.5 and 1.5%. When what it charges for borrowing is comparatively different and insane (in my own, personal opinion). The difference is unpalpable!

ESKIMO

I think that if we went back to a 'pay-as-you-go' (PAYG) service you would know exactly what you are getting. Now the banks can just dictate market demographics for profits - all to appease shareholders (great if your one of them). However the economics of banking is such a complicated one that if you did some 'real' digging you would realise that the banks lend money to investors, insurers and underwriters who invest it back at it's original source. Literally money does make the world grow round!

Inflation should be reflective of 'real-time' demographics like plant and animal growth - theory that 'money grows on trees'.

ESKIMO

Banks will only really tell you what you want to hear. Not necessarily the truth. Purely lip service!

middlepuss

ESKIMO wrote: »

Now the banks can just dictate market demographics for profits - all to appease shareholders (great if your one of them).

Great if you're a bank shareholder? Speaking as a bank shareholder I just wish you were correct!