Why are mainstream banks so awful?

[StevieBee]

Most of us here have horror stories with the big banks. I've long held the view that they are the primary institutions that inhibit business operation and growth. They make becoming a customer exceptionally difficult and any notion of 'service' when you are a customer is near to non-existent.

Why? What has changed?

[Rufus Stone]

I suspect compliance makes it more hassle than it's worth.

[Eric Mc]

To answer the question -

centralisationm and computerisation of decision making

destruction of branch autonomy

closing of actual branches

lack of true competition

inadequate government regulation

[Al Gorithum]

Regulation is certainly part of it.

I was recently involved in a project that would have brought £bns to the UK but couldn't get a UK bank interested, so ended up doing the business in New York.

[Frimley111R]

Eric Mc said:

To answer the question -

lack of true competition

Agree with those but for me it is this one. I told NatWest one time that I was leaving and when I had the guy at NatWest said that there are only a few banks, they each lose a small number of customers each year but replace them with the ones from the other banks. Essentially they don't care if you leave or not.

Customers are not important despite what they (have to) say.

[rdjohn]

There is next to no profit in retail banking. For what we pay, the service is pretty good.

They all tend to fail miserably when human intervention is required.

[ColdoRS]

I agree they’re absolutely ste, generally.

I’m paid predominantly in foreign currency and with this, I use Wise(formerly TransferWise) for payments in, then convert to GBP and move to my legacy UK bank to take care of my standing orders/bills/pretty much everything I spend.

Every month that goes past though, I get closer and closer to using Wise for everything, the legacy banks offer crap apps, scandalous interest rates, minimal notifications and slow service; wise is pretty much instant, great app, great phone support whenever needed, it’s flawless. I see less and less use for Nationwide/HSBC etc… for day to day banking. Lending may currently be a different story but they will probably be left behind in that regard too as they seem so slow and averse to change.

[smifffymoto]

When you read about ‘the bank of Dave’ you realise banking could be very different and a force for good not just profit and seemingly an old boys network.

I think even more scandalous is how new banking licenses are like hen teeth and how some of the established banks have managed to keep theirs.

[AlvinSultana]

Starling is a breath of fresh air.

[Frimley111R]

AlvinSultana said:

Starling is a breath of fresh air.

In what way?

And separately I was looking at the Chase Bank advert and wondering why I don't switch as they give you 1% on all your spending. In a year that's some good ££

[anonymous-user]

Until the last 10 years they've not really had competition so their practices are crazily out of date and in no way customer centric.

I asked a high street bank to transfer some direct debits from my personal account to our joint account, or make my personal account another joint account. The first wasn't possible, the 2nd required an in-branch appointment in another town, earliest date a month away.

We setup a new joint account with a challenger bank and switched my old personal account with all the direct debits within 15 minutes from the comfort of our sofa.

[Vasco]

Too many people seem to assume that banks are particularly interested in retail deposits, current accounts, direct debits etc etc. They aren't - that's just the mechanism that helps banking to do some of the big bulk transactions.

High Street banks are going to be far more interested in the customer wanting a mortgage, personal loan, insurance etc - all nice income earners for all banks and lending institutions.

[Puzzles]

I’m sure AML plays a part of it, it was fairly easy to set up an account with starling but judging by what I’ve read recently maybe this is no longer the case.

[Geoffcapes]

I remember when banks paid you to put your money into them, now they charge you to look after it!

[Fozziebear]

I recently opened a Barclays account to replace my coop account, did the whole switching thing with no issues, the coop took it upon themselves to close my account, no call to ask if I still wanted to use it, just bye bye. It does seem they don't care, but when there's millions passing through banks in loans every day my little account isn't worth the effort.

[Frimley111R]

Fozziebear said:

I recently opened a Barclays account to replace my coop account, did the whole switching thing with no issues, the coop took it upon themselves to close my account, no call to ask if I still wanted to use it, just bye bye. It does seem they don't care, but when there's millions passing through banks in loans every day my little account isn't worth the effort.

yep, you're too small for them to care, it's the same with every large business tbh.

[tr7v8]

In my younger days tried all the big names, ended up moving to Abbey Nat as it was then. Then ended up contracting near a small town with no Abbey. That was a pain so transferred to Nationwide been there ever since. We now have joint account & Mrs banking with them. They drop the ball on odd occasions but always fix it quickly.

[anonymous-user]

Frimley111R said:

Fozziebear said:

I recently opened a Barclays account to replace my coop account, did the whole switching thing with no issues, the coop took it upon themselves to close my account, no call to ask if I still wanted to use it, just bye bye. It does seem they don't care, but when there's millions passing through banks in loans every day my little account isn't worth the effort.

yep, you're too small for them to care, it's the same with every large business tbh.

You can't use the switching process if you want to keep your old account open. It's clearly stated in their FAQ's

[The spinner of plates]

Never had an issue with retail banks, maybe I’m either lucky or not asking them to do anything too complicated.

My salary goes in and my debits / tap spends go out.
App shows all this instantly.

I occasionally move around to get the deals they offer if worth it.
Don’t use overdraft / credit facilities, but aim to max cash back / points incentives on offer.

Pretty sure I’ll be in the ‘least profitable customers’ bucket

[monkfish1]

Frimley111R said:

Eric Mc said:

To answer the question -

lack of true competition

Agree with those but for me it is this one. I told NatWest one time that I was leaving and when I had the guy at NatWest said that there are only a few banks, they each lose a small number of customers each year but replace them with the ones from the other banks. Essentially they don't care if you leave or not.

Customers are not important despite what they (have to) say.

Correct. No competition.

Why do the need to offer anything resembling a good service when they can offer a st one.?