Finland is one of those countries that has a few big banks that dominate the retail market with a 60% to 70% market share, depending who is counting.
Competition is theoretically possible but not desirable; meaning that it is not desirable from the bank’s point of view! Consumers gave up desiring competition long ago when they realised it was wishful thinking. Changing from open bank to another bank is fraught with time-consuming work:
- You have to renegotiate your housing loan.
- The new bank will be forced to do the whole KYC (Know Your Client) process where they ask all about your most private affairs. You will feel like a criminal or outcast! Nobody seems to understand that your KYC data is the most private information that should never be shared with any commercial body. Banks can already access too much private information from your account. It is surprising that no independent public agency has been created to give ordinary people a KYC rating based on private data which they are obliged by law keep secure and secret like a gold vault.
- You must remove old applications and install new ones on your laptop and smart phone.
- You must change your debit/credit card details on a dozen websites…
- … and set up new e-payment details with the new bank.
- Finally you must change your account numbers with your employer, the tax authorities, and with others who make regular payments to you.
These banks have skilfully managed to stop unwanted clients visiting any of their offices by closing half of them, Calling a bank on the phone is like any call centre – you just wait, wait, and wait.
Here is a quote from FinnishNews in 2016 – you will see that not much has changed this last five years:
“If you have not been for some time in a bank branch, go and take a look at what is happening there. There are queues. There are dozens of grannies and grandpas… sitting, some are standing, and everyone is waiting… I waited for half an hour for cashier service…”
Duopoly has only one result – monopoly profits, huge new head offices and poor service – and yet these banks claim that they are providing an excellent service:
“At Nordea, we always strive towards delivering great customer experiences and making it possible for you to fulfil your goals and dreams…”
“Pohjola Bank and the OP Group form the largest financial group in Finland. OP provides its customers with the best loyalty benefits and the widest financial services…”
The banks have also developed a whole new service called “No Service”. This is a Finnish speciality of ensuring that their digital payment systems close down almost once a month every year. This first week in March has seen two such disruptions, and after five years the Financial Regulator has woken up by demanding to know what is happening.
The Competition Ombudsman is still asleep in splendid isolation and has not reacted.
Even more questionable is the proposal of the head of the Finnish Consumer Association who has declared that there are “pain limits” with bank service interruptions. He is telling members to have accounts and cards with at least two banks just in case you get stuck without cash abroad. Nobody told him that Finns are currently not travelling… enjoy your snooze.