Banks and their cash are hard to part

The Mail & Guardian has been following up on the refunds paid by banks with regards to the Nationwide airline liquidation.

According to card payment rules, the banks are required to refund customers who booked Nationwide tickets using their credit cards or debit cards. All four major banks have confirmed that they will honour this agreement; however, experience has shown that bank customers have received the runaround.

Despite assurances from the banks, it would seem that their staff on the ground are either completely unaware of this agreement, or it is in the banks’ interests to fob customers off in the hopes that they are unaware of their rights.

The M&G has been contacted by several readers who have been flatly told that they do not qualify for a refund. The experience was across all banks and all levels of banking, including the high-end private bank divisions.

Once the M&G supplied the readers’ details to the banks, corrective action was taken and refunds were given in all cases.

This raises a few questions. Are the banks’ communication systems so poor that they have no way of informing their call centres of important issues to prepare them for calls they should be expecting? This is in itself an indictment of an industry that considers itself among the world’s best and which has defended higher banking fees with the argument that levels of service in South Africa are superior to elsewhere in the world.

Maybe are we to conclude that the banks are just hoping that no one would know about the charge-back rules that provide customers with this protection. These refunds will cost the banks, especially Standard Bank, which was the banker for Nationwide, a fair amount of money.

However, banks make provisions for this sort of event, and the banks should rather have used this opportunity win over their customers’ loyalty. Receiving an unexpected R20 000 refund from one’s bank would probably have made a customer for life.

By using this as a PR exercise, banks would also have taken the focus away from high bank fees, or at least made those fees more palatable. It was also an opportunity to promote the use of card transactions—banks have been focusing on migrating customers to card-based transactions as they are safer and less expensive to run.

The bottom line is that this has been a wasted opportunity for the banks and has left the media, rather than the banking industry, holding the higher ground even though it is the banks themselves which have offered the protection and paid out stranded Nationwide ticket holders.

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