(Originally published in the Spring issue of Esquire magazine.)
I am a banker. No, hold it. I mean, I was a banker. Or rather, I worked at a bank. I did banking. But wait. Maybe that means I’m still a banker. After all, a doctor who drives a taxi is still a doctor. An American who lives in Romania is still an American. Does one stop being a banker just because they lose their corner office?
To be honest, I hope so. Because these days – though I’ve taught courses on banking, consulted in banking, and written about banking – I’m more a bank customer than a bank practitioner. And take this from someone who understands how it’s done: I’m embarrassed. Especially in this country.
Wasn’t it enough that the (I mean “my”) industry destroyed the world’s economy a few years ago? Doesn’t banking still need a bit of remorse and contrition? But no, that’s not what we see. I’m not talking about the isolated incidents of customers here bribing bank officials for a loan. I’m talking about a continuing and recognized institutional crudity.
I knew things were bad soon after I got here. Do you know in most other countries banks market their credit cards by telling you they help protect you from fraud? Yes, under Visa and MasterCard rules, if someone uses your card without your permission, you won’t owe the money. Your bank is required to have insurance for that.
Why then, I wondered, didn’t I see banks shouting that in Romania? Credit card penetration is remarkably low and it’s usually among the first things banks tell you. So I asked a few bankers and the answer was simple: they don’t trust you. And when I say you, I mean you, you Romanians. All of you. They think if you knew this, you’d all rip them off. How’s that for adhering to the essence of banking: establishing trust between the industry and customers?
As you’re too well aware, it doesn’t stop there. I’m on my fifth bank here and my list of complaints (and embarrassments) keeps growing and growing.
Recently, for example, I loaned my bank some money (that’s called making a deposit). They charged me for my kindness. Then, remarkably enough, I wanted some of it back – 100 dollars to be precise. After one minute and 58 seconds (I timed it) I got from the teller that single piece of paper (you know, the one that was mine), for which I paid the bank more than four dollars. Yes, that’s right. To get my money, I had to pay a fee that was equivalent to more than $120 an hour – probably about as much as the teller earns in a week.
Now, I know all the reasons. I know the excuses. These fees are for services. Services and other things cost the bank money. It’s the excuse airlines now give when they charge for meals, for luggage, for earphones, for pillows.
But in this case, I’m the one doing the bank a service – loaning it my money. Shouldn’t it treat me with a little respect? It’s not my fault they’re incompetent and the investments they made (using my money) went into the toilet. Aren’t there a few basic services that should be provided as part of the fundamental relationship of doing this business? Not even the airlines charge an extra fee for landing the plane.
Yes, I know this is not new. This has been going on here for a while. But at least in other countries enough people complain that the banks get defensive and are under pressure to change. But don’t get me wrong. The truth is I like banking. It’s a fascinating business that benefits society when it’s done fairly and when it’s done well. But as we can see, it’s also a sad little business when it’s done the way it is here.
In fact, despite the high fees, banking in this country is the least profitable per adult of any country in Europe, only ahead of Ukraine and Albania, according to Jean-Marc Velasque, partner at bank consulting firm Nouvelles Donnes in Paris.
And raising fees further won’t likely solve the problem. Usury laws might not pose a problem, but the banks are certainly aware of the law of diminishing returns.
“Experience shows that the more-profitable banks are the ones that have been able to create a relation over time with their clients, taking into account their habits and needs,” he said. No, indeed, we don’t see that here.
The huge irony in all this is that the banks increasingly need us. Many are under great strain. It can be more difficult in Romania to attract big deposits, and banks and bank regulators want the type of “sticky” deposits that only consumers provide – the type, in other words, that doesn’t fly to another country at the drop of a hat whenever politicians say something stupid.
Given all that, what do the banks here do? They charge us fees that encourage us to act precisely in a way they shouldn’t want us to act. Some charge for the internet. There’s an issuing fee for getting a credit card. (They should pay us to apply.) Second cards cost money. They trick you with come-ons and terms you can’t possibly understand.
Yes, they want you and they spend lots of money to try to attract your business. They offer you a little cash back. They devise programs screaming high rates, which only last a few months. But stop. Do the math. Even someone lucky enough to earn a very fine salary, if they fell for these programs, might benefit by only a few lei a month – not even, in many cases, enough to cover most fees. And in case you don’t like it, like a bad prenuptial agreement, it can cost you five euros if you want a divorce.
Honestly, more than embarrassed, it’s enough to make me angry. Because I’ve seen banking elsewhere – and there’s no reason it’s not better here.
Do you know in other countries banks know they’re in retail and employees are encouraged to smile and say “hello” and “how are you?” and even, believe it or not, “may I help you?” when you walk in?
Do you know in other countries, managers help the tellers when the lines get too long? (If they can do it at the grocery store, then why not the bank?)
Do you know in some countries banks have little bowls of candy or offer you coffee – for free – while you’re there? In fact, sometimes there’s a human who stands by the door to welcome and direct you. (And I don’t mean a security guard who stares at you and scowls.)
Do you know in other countries banks like education? Top executives make sure the bank helps pay for MBAs, not shrug (as I’ve seen here) and say it’s not important. In fact, why do I see so little financial education sponsored by banks and offered for children? (Speaking of children, do you know some banks in other places have a place for children to play (or at least cartoons to watch) while their parents are there?)
Come to think of it, why doesn’t the industry here begin to educate itself? Drop all the gimmicks and change the way it does business. If banks could get people to like them, those people might want to be customers.
But again, we don’t see that. And that certainly helps explain why half the people in this country have no relationship with a bank – the worst figure in Europe. And why would you? It’s no fun to go there, you don’t write any checks, and you pay all your bills down the street at the Post Office (where, by the way, at least sometimes people smile).
So is it any wonder that we pull all our money out as fast as we can? We use our debit cards here 50 percent more often to take money from ATMs than at stores to make payments. Indeed, for every leu we spend using a card, four lei are pulled out of ATMs as cash – and as quickly as possible to avoid even more fees.
Given all this, I think – at least for a while – I’ll stop saying I worked in banking. I’ll rewrite my CV and make some creative adjustments (if the Prime Minister can do it, why can’t I?) But I need to account in some way for those dozen or so years starting in 1996.
I could say I was in a coma. Or perhaps stranded on an island. Or I suppose I could say I was locked up in prison. Yes, I like that last one. It’s less of a lie and at least in Romania, I could go into politics.