Friday, June 21, 2024

Standard Chartered Bank is undermining Government policy of financial inclusion

Some months back, Standard Chartered closed hundreds of banks accounts across the country.

The reason given was that the accounts were not able to derive P500 000 a month.

That, according to Standard Chartered made these accounts too costly to operate.

Whatever moneys were left were issued out for cashing or transferring to another bank.

This was a scandal.

People only learnt of the closures of bank accounts when they visited the bank.

Sometimes a cheque to a third party would not be honoured, and upon enquiry one would be advised to visit the bank where the sad news would be broken.

Without financial inclusion, breaking out of the poverty cycle will become near impossible.

These incidents were not few and far between.

They were frequent.

Some people, some businesses and some organizations including churches have had their organizations closed down without an explanation.

In a country where half, if not more of the citizens do not have a bank account, a decision by Standard Chartered to close so many bank accounts because they made less than P500 000 a month was shocking.

It serves to show how out of touch the bank is.

For a bank that prides itself as being “here for good,” what they did was shocking.

The decision by the bank further marginalized the very same people who are struggling to enter the financial services main arena.

This, by any measure should be against the express goal of the government to include as many as possible into the financial services.

Banks should assist Government.

The former Governor of the Central Bank has in the past decried a “headquarters” culture by the London based banks.

What they do is to take all of the profits to head office with no regard for the countries where the profits are made.

No investments are made, not even on human resources.

Willingness and ability to use a bank is something that should be nurtured ÔÇôby the banks.

The bank might argue that it had become costly for it to maintain these small accounts.

But that is not plausible today.

We are being led to believe that there is so much technology available that could be used to manage these accounts.

Just closing them down, without a word with signatories is harrowing.

It goes a long way to show how heartless some of these institutions are.

It does not matter to them that Government is today busy trying to get the multitudes of the unbanked people approach banks to open accounts.

The decision by Standard Chartered, while reprehensible and unpardonable goes a long to show how little investments in digital infrastructure our banks have made.

They still rely on one-size-fits all, where the same technology used for managing huge accounts also manages small ones.

It is time setting up a local bank is considered.


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