Faster, friendlier, cheaper banks only a strong client lobby away, advises SA ombudsman.

10 March 2005 - Cape Argus
Maureen Marud

"People hate banks because banks hate people," joked banking ombudsman Neville Melville in reply to a question from the floor when he addressed the Cape Town Press Club yesterday.

Journalist Margaret Legum had asked him to comment on consumer fury over the service delivered by South African banks and charges that were "out of all proportion" to those overseas.

Melville said that he received about 3 000 responses tp a personal internet search using onlty the words "hate bank".

He said that part of the problem was that South Africa did not have a strong client lobby to put pressure on them.

Referring to the introduction last year of the national Mzanzi bank account for about 13 million people who had never banked before Melville said the banks made no profit from the account, which indicated that "things do happen" when pressure was brought to bear.

The Mzanzi account was introduced as part of the financial sector charter to promote a "transformed, vibrant and globally competitive financial sector" that reflected South African demographics and provided accessible financial services to black people.

In reply to another question, Melville said he did not know if he was the only banking ombudsman in the world who expected clients who complained to his office not to communicate with the media at the same time.

He said "soft mediation" when dealing with banks was more effective. Banks might be less amenable if the media was involved.

But Melville also admitted it was "nice to have as a big stick the threat of the matter ending up in the media" if banks did not accept his recommendation.

His office relied very heavily on the press to assist it in performing its function, but he still preferred to get "willing compliance" from banks

The ready response from the media to his annual reports had changed his relationship with banks considerably

Although some had resisted and resented the coverage after the first annual report about four years ago, it had been very beneficial as systems had changed in the banking environment and "our life has become much easier."

Of the roughly 14 000 inquiries made to his office every year, files were opened on about 3 000. About 54% were resolved in the client's favour.

Asked why banks were quick to charge a client for a mistake, but would only apologise when the mistake was their own, Melville replied amid general laughter: "I am surprised to hear that the banks apologise. That's a new one. We have cases where they would rather pay R10 000 that tender an apology."

Asked to comment on collusion in the local industry comprising "only four banks" he replied: "At the level I deal with at the banks, to get two of them to sit at the same table would be difficult."