Pundit slams banks’ lack of personal touch

A financial pundit has cited the loss of the personal touch as the reason for consumers’ declining confidence in banks.

Speaking at the Building Societies Association’s annual lecture, David Lascelles, co-director of the Centre for the Study of Financial Innovation, says banks have lost touch with their customers and public opinion.

But he says it is wrong to hark back to a golden era of banking. The rose tinted view of banking 40 or 50 year ago as an era when the bank manager ruled supreme ignores the fact that banks discriminated against a high proportion of the population. Banking was not a service open to all.

However, the erosion of the old world of banking with the experienced bank manager servicing the community and the switch to credit scoring, computers and a profit driven attitude has brought its own problems.

While everyone now has their own current account and can get a mortgage, mis-selling and market abuse have eroded consumers’ faith in banks.

He says that the fundamental problem is one of mismatch.

Lascelles says: “A mismatch exists between the expectations customers have of banks – expectations of a high quality service that comes for free or as close as – and the inability or unwillingness of the banks to provide this. Banks must give more thought to why they have been unable to convince customers they are providing a service that has value.

“But part of the problem lies with customers, who must be clearer about what they expect from banks.”