Monday, 31 August 2009

A Banking System

We have now been in England for a little over two months and we are still having problems with getting the UK banking system to work for us and not against us. Our initial slow progress was caused by working through a suitable foreign exchange arrangement but it is also slowed by the over regulated and over managed banking system.

To open a bank account in the UK, you have to have a permanent address at which you are paying for services such as power. The problem is to rent or purchase a property, you need a bank account. The way around it is to have an overseas bank vouch for your credentials which is what we did. That gave us a base from which to work. Having our daughter living here gave us a UK address so in theory, we had a head start.

However to get a better interest rate on our savings, we decided to open an Internet account with a building society. It took us a while to review the possibilities but it is nearly three weeks since we started the process of opening the account a beginning to transfer the money. The process is long winded and fill of delays each of about five working days.

The first step of the process was to submit paper work along with proof of identity. We came away from that thinking all that we needed to do was register online and we would have our account but we had to wait for the building society to send us through the post an customer number. This would take five days. Once we received that identification code, we could register online but not open the account. That required yet another snail mail notification through the postal system. Now we have that we got in and had to transfer the money (oops!! there is a limit to how much you can transfer electronically in a day – Ok! We will just spread it out over a few days and we will be right). Not quite!!! Having activated the savings account online and deposited the initial transfer, we weren't allowed to look at the account or do any transactions on it until it was unlocked by the building society. This could take up to another 5 working days.

If you have done the calculations, this is three weeks to do a simple investment. You have to ask whether these banks really want our business. We are informed that this is all about ensuring credibility and security in the system so that no one can defraud us and so we can't launder an ill gotten gains.

In effect, we are being treated as possible criminals. Should the banking system be surprised that ordinary people who in their normal daily operations wouldn't think of defrauding the system begin to do so? We are concerned that it might take a month to get our money out when we decide to buy a house. What is that going to do to the purchase process. Mind you we are told there are other issues in the purchase process that could cause a house purchase to drag out for a year or more. One has to ask whether the British system of finance is really designed to work for the customer but there again maybe they haven't heard of the customer. They have only heard of the criminal.

One philosophy argues that if you want the best from a person, you should treat them as you want them to be. As I reflect on the British banking system, I see that everyone is regarded with suspicion and is treated as a potential criminal. It is difficult to believe that the majority of 61 million people have criminal intent. There is no trust in the system and as a consequence little trust develops.

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