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The banks lost our trust – but can they win it back?

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Our executive director, Richard Lloyd, appeared on BBC 5 Live on Monday to discuss the future of banking with a panel of experts. As trust and culture topped the agenda, aren’t we overdue a big change in banking?

British banking culture is under more scrutiny than ever. As staff incentives have focused on sales for too long, the ‘sales first’ culture has leaked from top executives right down to front-line bank staff. Richard Lloyd added this morning that the culture of banking will only change when customers are put before sales.

Philip in Nottingham called in to BBC 5 Live and told the panel:

‘They need a good spanking all these bankers. We need to tell them there are new terms and conditions – take it or leave it. And we, the public, should run the renumeration committees responsible.’

Bank service versus sales

Mark, a Natwest employee, texted the show to say:

‘I worked for NatWest for almost 20 years. Until banks return to a service-based outlook as opposed to an aggressive sales culture, bad behaviours will continue. Sales sales sales, sorry, ‘meeting customers’ needs’ – is the underlying problem in branch banking.’

A listener named Jan also rang the panel to share her view on one way to change banking culture:

‘There are not enough women in banking, and certainly not at the top levels – I believe there’s not a single global bank that’s run by a woman. Clearly the culture which runs through an organisation is determined by the people who run it, and a little less testosterone and a little more conversation might help.’

Have banks been trading on our trust?

So consumers’ trust in banks has been seriously shaken. Greg Clark, financial secretary to the Treasury, made a point that people trust their banks to act in their best interests. But he added that, , that trust has been abused. In our recent research, we found that over two-thirds of people don’t trust bankers – leaving them less trusted than estate agents and lawyers.

To highlight the problem, one consumer texted the show to talk about the PPI mis-selling scandal:

‘This was not perpetrated by a tiny number of bankers… this was the whole of the banking profession, from directors to clerks.’

One tweeter contacted us to talk about his lack of confidence in bankers’ training:

‘My 24yr niece. No academic qualification to her name, earns enough at [Big Bank] to run new Range Rover and has a penchant for spending! It beggars belief and makes a mockery of having need for academic qualifications.’

When Ross McEwan, head of retail banking for NatWest and RBS, suggested that consumers lacked confidence to borrow, one tweeter said:

‘Lack of confidence’ – not surprising. RBS et al wiped all possibility of financial confidence from UK’.

Can switching make a difference?

It’s often suggested that people should switch their banks if they are dissatisfied with their service. But our research found that UK consumers are more likely to get a divorce than they are to switch their bank accounts. One caller to BBC 5 Live explained their reason why:

‘You say ‘why don’t you move banks?’ It’s because they’re all the same.’

While another tweeter made us laugh by suggesting:

‘Could banks not attract customers by combining both in special offers? #Divorce #SwapBanks’

If you want to find out some of the suggestions the panel made for improving banking in the future, you can tune in to replay the show. Our Big Change campaign is working hard to try and fix some of these issues, but in the meantime, how do you think we can change banking culture in Britain?


Katie, a lot is said about putting customers first. However a banks role, like any other joint stock company, is to produce dividends for its shareholders. If it does not perform then it will go out of business eventually. Having said that, the way it should perform and make profits will in part largely depend upon it doing a good job for its clients – including its private customers. If they desert it then again the business will fail.
We can only hope that the events of recent times will ensure some banks recognise the increased emphasis they need to place on customer service and trust. We always have the option of deserting a bank we don’t like.

Stephen Rosling says:
20 February 2013

Malcolm R – No evidence Malcolm. I’m simply making two observations:

1. Where one customer has a complaint of this nature there are likely to be others. As a minimum the bank should conduct some root cause analysis and if there is anything to suggest unfairness, (as a result of process and/or system), and that other customers may be affected, they should be taking action to remedy.
2. If it can happen in the US, (or indeed anywhere), there’s no reason why it couldn’t happen here, (particularly in light of recent bank behaviour.)

W should also bear in mind that customers can make unreasonable complaints and not always assume the banks – or other institutions – are automatically at fault.
Of course unfairness or deceitful behaviour can happen anywhere – and should be dealt with. But it is wrong to tar all with the same brush.

Regarding timing of direct debits and available funds, my bank – Nationwide – has amended its terms and conditions: “We’ve changed the way we deal with direct Debits, standing orders and bill payments that you ask us to make on a future date. We attempt to make these payments in the morning and if there are insufficient funds in your account to make the payment we will now try again later. As a result we’ve updated our website to confirm the latest time by which you need cleared funds in your account on the day a payment is due to be made”. Seems reasonable?