Changing bank accounts is just too much hassle, a survey of consumers found, said Keith Weeks of the banking inquiry technical team.
Next week, the final set of banking hearings will resume and, apart from pricing, it will look at how difficult it is to change bank accounts.
But are banks the only ones to blame? Perhaps it would be worth making a presentation to the committee on the impact of regulation and how it not only prevents access, but entrenches the positions of the dominant players.
In the past week, attempts to open a bank account and to change cellphone providers were hampered not by the companies involved, but by regulation. Between the Financial Intelligence Centre Act (Fica) and the new National Credit Act (NCA), it is indeed a bureaucratic nightmare to change providers, which ultimately entrenches the status quo.
My domestic worker wants to open a long-term savings plan. To do this she is required to provide proof of residency. As she lives on our property, she receives no utility bills. The Act therefore requires my husband to go to the police station to sign an affidavit saying she lives on his property and then provide her with a utility statement, and the affidavit, to take to the bank. As he travels extensively, he has not had time in the past two weeks to go to the police station.
Exemption 17 of Fica states that low-income earners do not need to provide proof of residence, but the bank says the clause only applies to people living in squatter camps – a live-in domestic worker does not qualify.
A domestic worker’s attempts to start saving will be determined by the employer’s cooperation. What if an employer is not prepared to go to these lengths or has concerns about handing over the household utility bill? The bank would love to help her save but apparently not the regulators.
Last week I also tried to port my cellphone number to another network. I will save R40 a month by doing so, but I am not sure it is worth the hassle.
Because of Fica requirements and the NCA, I have to provide certified copies of my ID, which requires going to the police station, as well as three months’ bank statements. But as a fully electronic banker, all my statements are emailed to me. This is not adequate under Fica, unless I can provide a cancelled cheque for validation purposes. But I do not have a chequebook. So now I have to ask the bank to print a statement, costing me time and money.
In both cases, the bank and the cellphone provider would love to help – they know I am not a criminal – but they cannot because they face fines of up to R1-million if they do not stick to the letter of the law.
According to a manager at a large cellphone service provider, people are slowly adjusting to the idea that it does not matter how much they scream and yell, they will not be able to enter into a contract without the necessary documents. Maybe we should have a commission of inquiry into the impact of regulation on people’s freedom to choose?