Multiple banks? Why would you do that to yourself, why? Isn’t one bad enough?
Well, the short answer is actually yes, and that’s exactly why I have a relationship with them.
The truth is, as with any organisation, their main focus is making money. I took an interest in banks at a young age, when one of the majors here in Australia had a wonderful campaign to reel in children by getting them to save. This genius strategy meant that the bank gave us a branded money envelope and deposit slip book, all with the cuteness of kiddish characters – it was actually perfect. My whole school was hooked and I remember pestering my parents for a dollar to deposit because that was the cool thing to do.
Needless to say, I only have one account with this bank because of them trying to charge me fees when I was a student when student banking was supposed to be free, and I had presented my student card to them seven or eight times – but they just kept “forgetting” and charging me fees. That was really the first time that I thought about going to another bank.
You might think it’s petty to go to another bank because of a $4 or so monthly account-keeping fee, but I was fresh out of school, studying in university and trying to get by. I was relying on this $4 a month to help keep me afloat and the bank that I had been loyal to had betrayed me. I had to fight to get the monthly fees reversed and they wouldn’t even reverse all of them.
That’s when I found out – a competing bank was actually offering the same type of everyday, basic style transaction account for free. I didn’t even need to show them my student card, it was free for people regardless of their circumstances. Had I not had the negative experience with my bank, I might have graduated from uni and then started paying the fees unknowingly. I just had no idea about what was out there.
So this is a big reason as to why one should interact with multiple banks – even if it is painful to some degree. It might pay off in the long term because banks try to differentiate themselves through many of their products and services. Another thing I’ve also noticed is that as a new customer, I tend to often get far better treatment as an existing one as they need to actually work to get my business.
It’s like once the novelty wears off, I am no longer of interest to the bank. Furthermore, I know that if I tell my existing bank that I want to get a new loan but bank Z has offered me a better rate than what’s on offer, my existing bank will either try to match it, or risk losing me as a customer. So it’s a pretty good way to make them compete in my experience.
I’ve found that unless I’ve threatened to leave, many problems remain unsolved. I’ve probably found 1% of employees to be genuinely knowledgeable and helpful. It’s so hit and miss – no wonder people keep switching between banks. I’ve given up on “switching” as such, I just have things spread relatively evenly between the majors.
Of course, everyone has different experiences, but these are my ramblings and I hope that they’ve been somewhat insightful.