Paying for Nothing at All

 One of the stakeholders that you end up having to deal with in the insolvency business is banks. The job requires you to do things like shut down bank accounts and making formal request for information on bank accounts. So, a good portion of my time is spent visiting banks.

Waiting in banks for counter service can be time-consuming. Banks, particularly in the counters have been understaffed and processes are, well, a little less than efficient. It’s become even worse. Singapore has not been immune from the global rise in inflation. Interest rates have risen and savings accounts, which used to be a license for the banks to print money (they borrow from you at 0.025 percent a year, lend at eight percent and charge you for the privilege of lending them money), have suddenly become viable assets for ordinary depositors.

So, as much as the banks have touted “digitalisation,” inefficiencies have grown as people flock to banks to open accounts to take advantage of the increased interest rates. Despite all the hype around “digitalisation,” the process of opening a bank account remains untouched by modernity – you still have to go into the branch to open a bank account. Hence, banks like CIMB, which used to be very prompt in getting you the counter are no longer so:

 

 That’s before you take a number for counter service

So, given that bank branches have seen a deluge of customers rushing to deposit funds at their branches, the logical question is what exactly have they done to ease the congestion at branches and making the process of opening an account easier?

One of the most common ways of dealing with customers has been to shut your doors. Both OCBC and UOB have done precisely this on a number of occasions. They have pasted signs on the door saying that they have stopped issuing que numbers. In the case of OCBC’s main branch of Chulia Street, the security guard who is paid by Certis Cisco, then doubles up as OCBC’s customer service man at the door trying to deal with people who wanted to give OCBC money, whilst the actual OCBC staff stayed inside trying to avoid the customers who were actually inside the bank waiting to give the bank money.

Another example of how to deal with an increase in customer traffic has been to increase the number of superfluous staff without actually increasing the number of people who could actually do things for the customers. The most recent personal example came a moment ago when I had to deliver a letter to OCBC on Chuila Street. The que was slowly developing and there was a girl at the counter. Unfortunately, the only thing the young lady wasn’t qualified to receive letters or solve problems. Her main purpose was to press buttons on the machine that issued que numbers. Meanwhile the girl who was qualified to take letters was running around like a headless chicken.

 

Empowering people to push buttons doesn’t exactly help

So, how is it that some of the biggest institutions in a country that prides itself in maximising human resources, forward thinking and planning, have only be able to deal with a situation by effectively shutting themselves down?

One might say that the answer is simple. These institutions have been mollycoddled from the feelings of customers. The regulator takes pride in the fact that the existing institutions win all sorts of accolades in a competition that the existing players have rigged amongst themselves. Bright sparks who manage to come up with an idea that might make the lives of customers easier get side-lined by the regulator and end up working for the existing players instead of competing against them. Hence, whilst developing Asia allows bright sparks to develop viable fintech, the regulators in Singapore make it such that the fintech crowd are forced to become contractors to the banks and the bright sparks who create end up being subservient to the bureaucrats in the banks who are busy defending their turf instead of finding ways to grow it.

The regulators in Chinese-majority Singapore need to look at Chinese history to understand that protectionism only leads to stagnation. China, once the world’s greatest power and civilisation stagnated in 1500 because the emperors believed in their own propaganda. Europe in the meantime allowed for competition, which created innovation and when China met the West 300 years later, she was greatly outclassed and humiliated by a group of powers it once considered not worthy of speaking to. Our regulators need to understand that it does not do our institutions any favours by protecting them from competition.