Namibian banks burning holes in our pockets

A HEALTHY banking sector is extremely important for promoting efficiency in an economy and it can provide useful services to the population such that they don’t need to hide their savings in cash under the bed or they don’t need to pay with notes every time they want to purchase goods.

However, it is not uncommon to hear Namibians complaining about the exorbitant prices that the four commercial banks (Bank Windhoek, First National Bank, Standard Bank Namibia and Nedbank) charge. And it’s no wonder considering how much they are ripping us off. As Table 1 shows, the banks in Namibia charge their customers for services that are completely free in the UK – a country with higher average per capita incomes than here.Especially absurd is when the banks make us pay for taking our money as cash deposits, which they can then use to invest in the financial sector to make profits! Or when they charge for Internet banking even though the process is automatic – when banking transactions are done online, there is no need to pay the salary for a teller, so what are we paying for exactly?Clearly there is not enough competition in the sector and that is allowing banks to be lazy and get away with it. Surely if there were more banks for us to choose from, they would start competing against each other to provide the best prices and services to attract consumers and we would be better off?This is how it works in the UK. Banks there even offer gifts such as iPods and reduced travel tickets to sign up with them, there are many ATMs to access money and queues are much shorter. Long queues in Namibia impact the economy through reduced productivity because people take time off work to bank but spend hours every year standing in line. What’s worse, is that when you reach your turn, the assistants rush you so much that you can’t think straight or remember what you needed to ask in the first place!What ever happened to customer service with a smile? Eliciting information from them is difficult whether it be from their stores, websites or leaflets. Their price lists are not comprehensive or clear and it makes it hard to keep track of what you are paying them.I’ve even heard of one person whose card was used fraudulently causing him to lose N$2 000, but when he approached his bank for compensation, they refused outright. It doesn’t have to be like this. In other countries, there are laws to protect the individual in such circumstances and the customer is not the only winner. The banks themselves retain customers and their funds whilst the country’s banking sector prospers because people trust that they will not lose money unfairly. After all, isn’t it the banks responsibility to ensure that it provides adequate security encryptions and keep our money safe?And talking of safely kept money, is it right that poorer Namibians are priced out of the banking sector because they cannot afford the high fees – meaning that their home-stored earnings are exposed to robberies and they do not earn inflation-busting interest?Banks might justify their behaviour by pointing to the country’s small population (and therefore less economies of scale) or the long, cost-increasing distances involved in travelling around, but that doesn’t explain why each annual report shows they make millions in profit.It’s about time they passed on a portion of these to us and curb our exploitation.Perhaps then, it is also time Namibians went from waiting in queues to forming queues of protest and giving banks a run for their money…?