Aaaaah! What is it about? Vault of termites? Yes! Yes! With emotional scars. Are you ready to know more about it? Okaaay! Come around and let’s have a conversation. We save a portion of our income for future use. Regular savings accumulate into a big pool of funds which an individual can use for many economic purposes; but cultivating the strong habit of savings has, however, been a challenge for many people. The rhetoric of those who are unable to save has always been that there is not enough to invest for a rainy day after daily expenses on consumption. Traditionally, people used to keep their money at home or in surroundings which could not guarantee the safety of those savings all the time.
Through financial literacy programmes, many people realise the need to save with banks. Indeed, the increasing number of financial institutions in present-day Ghana has given every prospective account holder the right of choice regarding which (financial institution) they could at will save their money with. To engender trust and confidence in the banking public, licenced financial institutions are required by regulation to put structures in place to ensure the highes level of protection for cash deposits.
In line with that, banks invariably conduct structural integrity and risk assessment tests on the branch premises, especially at the vaults’ locations to make them security-safe. In addition to that, other security measures are installed to provide an all-inclusive architecture for safe banking. These give customers (savers) peace of mind that their deposits are in safe hands in all respects. But many experiences have proven that banks can have the best of security systems and safest vaults and yet lose their customers. The most priceless and treasured vault of value which customers need from the financial institutions is ‘trust’. Trust! Trust and trust.
It is worth averring that anything which takes away this trust is as good as bubbles and wipes away customers’ confidence in the banking system as soon as it fades.
The banking business by its nature experiences loss of confidence when the public (depositors) begin to harbour feelings of mistrust or uncertainty in the banks’ operations. In fact, the build-up of mistrust could trigger (key) customers to withdraw their funds. This is the last thing any financial institution would wish itself, no matter the quantum (adequacy) of its resources. We can appreciate people’s mistrust for DKM and the likes; it is not worth the time citing those instances again.
Indeed, your guess would be as good as mine regarding how people would react if advised today to save with those institutions on the premise that they have resurrected with the modern vaults and surveillance systems. Where is the trust to start all over again? There are many other similar instances, far and near, which cause people to mistrust financial institutions and then resort to keeping their money away from them. By the courtesy of the manager of Kpassa Rural Bank, we can ponder over the case of an elderly woman who lost her GH¢4,000 savings to an unknown financial institution, which ran away.
The dreadful experience left her with an emotional scar and caused her to mistrust financial institutions. As a result, she opted to keep her subsequent savings in a hidden dug-hole ‘safe’. Unfortunately, she lost the savings (GH¢1,700) from her toil to a horde of termites. We can also reflect on the cases of a Taiwan woman and the 60-year old Chinese farmer who lost £32,000 and US$3,000 respectively through similar incidents.
You will agree with me that those financial institutions might have had the best of vaults (safes), but the victims’ deep-seated sense of mistrust from the sour relationships caused them to adopt vulnerable mechanisms to save their money. The ‘safes’ in which they resorted to keeping their money can best be described as the vaults of marauding termites. These termites end up scratching the existing emotional scars.
All these harrowing experiences further buttress the fact that we can have the best and modern foolproof vaults and security arrangements in our banking halls, but they cannot be more securing than the treasure of trust at the heart of banking. With those living examples, let us bring our minds back and consider the incidents which have happened concerning some mainstream banks since August 2017. We can appreciate them better in our own measure with different understandings.
Recently, students of an institution in the country called the school’s Finance Manager to ask if they could go ahead and pay their fees at the school’s usual account-holding bank. The students wanted the confirmation because they heard news that the said bank is also grappling with internal challenges.
In fact, the students’ feeling of uncertainty and reluctance to deposit with the bank where they had in the past transacted business in comfort is revealing. In the previous instances, they paid without second-guessing the bank’s current hiccups. This occurrence also goes deep into the root of the fact that trust builds customer-confidence and serves as the fulcrum around which the banking business revolves.
Security systems are equally priceless but affordable. Trust lives in its own realm and is non-negotiable. Expensive branding and advertising campaigns cannot buy it. It does not come on a silver platter if the fundamental problems which give rise to the mistrust linger on.
Rebuilding Trust & Confidence
I wish we could psyche ourselves and exude the popular boxer Ayitey Powers’ mental fortitude and slogan, “what-can-come-can-come”, for the things which befall us in respect of the central bank’s recent sanctions and directives. The media will also come at us with force in their reportage. We may not like it, but that is their job – though they also have their age-old problems to deal with.
We should take consolation in the fact that there is always light at the end of the tunnel. In light of this, the opinion of Dennis Jacobe – who was the former Chief Economist at Gallup – is reassuring. He said: “It won’t always be this bad for banks. It will get better – it just takes time for things to right themselves”. Ironically, the financial sector clean-up exercises which are being conducted by the central bank to restore the trust and confidence in the banking sector are the same ones which make us (bankers, depositors and the public) worried. We need to stand resolute to correct the wrongs.
In our efforts to regain trust and confidence we should ensure transparency in our relationship with the public. This, in my view, will demand commitment from us to provide all-front, clear and accurate periodic (financial) information to the banking community. We should also make conscious efforts and undertake regular stakeholder engagements. It is also necessary to build loyal relationships with the customers or leave to fall on our own swords.
My friend, branch and operations managers and everyone handling physical cash – please, let’s have a small conversation. It is for your ears only. Ensure there are no cracks and burrows into the vaults. No food particles. We don’t want journalists to get wind of termites invading the safes. Termites by their nature can do anything, no matter how metallic and fortified the safes are. Should the inquisitive journalists pick up any hint relating to that, you can predict the usual screaming headlines – ‘Termites evade ABC Bank, chop millions of Ghana cedis’.
You can imagine the introduction they would give to the storyline – “At a time when the Bank of Ghana is requesting all banks to raise their minimum capital to GH¢400million and protect depositors’ money, one would expect them to put their house in order – but they have left their vaults and cash to the mercy of termites”. Our Corporate Affairs/Communication managers will come in to do their usual best.
“Oh! You know, these are old branches. We are doing an intensive renovation to let our customers have a delightful experience. It is the groundworks which opened the bare earth. Customers deposits are however safe and intact”. Renovation, “for where”? PR galore. But you already know how the local FM stations will give it the blaring twists. You also know how the market women, traders and customers will react to the news. Mi sika wŏ hŏ ooo (to wit, my money is there ooo).
They will run “gidigidi” (helter-skelter) into the banking halls. Panic withdrawals! You can imagine the effects if this happens. It will have a further toll on our operations and the industry. We will lose revenue. We can’t pay our bills. Air-conditioners off. Banking halls hot. We hang our suits and the termites find their way into them and ‘chop’ all. This is what happens when the bond of trust with the depositors is broken. With quips, more jokes are good for our health.
By Gershon P. Anumu (ACIB)
Blessed Times, God is with us. Thank You. It’s bye for now.
The Writer is a Chartered Banker