My youngest son has a bunch of songs he trots out, each for the right moment. ‘Had a bad day’, is one of them, and just the right song for my Friday and Monday, which turned out to be double-edged ‘bad’ banking days. It doesn’t matter which bank. It knows, and it messed me badly.
But the fact is that the twists and turns of roving cut offs, claims of digital illiteracy or blindness, missing funds, and instructions not executed, is everyday fare in our virtually unregulated banking sector. So how does it look in other places?
Did some bankers from Country X, having been born in Country X, just grow up in some Country-X-type fashion that meant they decided not to hurt those that bank with them? No one will ever know. Because, as it happens, in all those nations with way better banking than ours there are regulators.
So we can’t know if banking would have got better without them.But we can spot the remarkable global blank in countries with great banking, but no regulators. Of course, in every country, the central bank is a banking regulator.
But its concerns are dominated by fundamental matters like inter-bank lending and payments, and ensuring banks have sufficient capital adequacy and liquidity in the general cause of preventing banks from going bankrupt.
Some aren’t even especially good at that. But in the Country Xs with genuinely great banking there can be six different types of bank regulators or even more. They have the regulator checking banks are financially solid, and another one to check they are behaving well and not doing stuff like fixing financial markets in their favour, or running crooked books, or stealing their customers’ funds.
Then there is a regulator to regulate payment cards, as in, for customers! Because a lot can happen that’s bad with payment cards in economies where cash is disappearing faster than a rat up a drainpipe. So that particular regulator makes sure the rules and penalties are there to ensure that customers can rely on the functioning of the world’s ‘new money’. There’s another kind of banking regulator for customers too.
A lovely thought, this, in those kindly, considerately regulated places – the regulator who ensures banks’ retail customers are correctly and well treated.
Oh please could we even just have this one, with some rules to go with it on compensation for banking errors? For, when those Country X customers are not well treated, there is another regulator again that ensures they are correctly compensated for any financial mistreatment or wrongdoing.
So that’s quite a little array there of regulators, and enough to ensure a hugely better time for banking customers. Now that’s all very well, of course, but running regulators takes funds. And our government doesn’t have any of those. So no regulators this season, you may assume.
Except, there’s that matter of the banks themselves. What decent bank that we should trust with our money wouldn’t want to contribute to the establishment of an independent regulator – or six – to deliver great and wondrously excellent banking to the Kenyan public and to each and to all of us?
All those profits, all that wealth, could it cover just a bit of contribution to delivering on their own ethics in some guarantees and care for customers? I only mention it. Because, right now, unregulated, I can vouch for the fact that our fairly lousy, cranky, often failed banking services are definitely hurting our economic growth.
Our businesses end up getting their hosting cut off because they cannot get transfers effected in a timely fashion, they lose sales on achingly slow export credit guarantees, they crash into the buffers on lost and delayed incoming payments. In fact, the list is extensive.
So this is a place where the government should step in, or parliamentarians, or the central bank and say, you know what, these banking services aren’t good enough.
They aren’t good enough for me, they aren’t good enough for you. They aren’t good enough for Kenya to get where we want it to go. So now we regulate. And fix the basin. Thank you.
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