British campaign "Move your Money"
banking: Reviewing your vows
Would you be content
knowing that your money may be financing the arms industry or perhaps fossil fuel
schemes? Do you really want your savings linked to tax heavens, risky speculation
and customer fraud? These are the questions asked by the British campaign "Move
your Money". It is a call for action which has already received over 600 pledges
from people supporting more ethical financial institutions: they are disappointed
customers that want their power back
By ISABEL BENITEZ (firstname.lastname@example.org)
from Manchester, UNITED KINGDOM
can demand around three weeks to have it done. It is difficult to get an appointment
and challenging to survive that requested interview that is full of confusing
and indiscreet questions about personal likes and dislikes - books you read, music
you love, activities you devote your spare time to, etc; but it is worth it, anyway.
After dismissing the idea that, with such unnecessary questions, the agent was
attempting to ask you for a date instead of providing you with assistance to open
a bank account, it is all a mixture of relief and joy: you are finally holding
the letter that proves your mutual engagement, signed by both parties and sealed
with a kiss.
It is the beginning of a true love story, your love
story, the story of the faithful customer and the charming bank. Needless
to say, it can be amazingly promising. However, not all the love stories have
a happy end.
your Money could easily be deemed the remedy to heal broken hearts.
In two weeks, this British campaign has become the latest expression of customers'
disappointment. It asks banks for the respect their beloved partners deserve.
In good times and in bad
Signing the document formally binds client
and bank lives on well beyond the honeymoon period. Regardless of how hard it
was to win the bank's affections, co-habitation brings us back down to earth and
forces us to deal with the everyday issues of a relationship.
HSBC was hit with a record 10.5 million pounds fine for selling unsuitable
products to almost 2,500 elderly customers. That same year, another big bank,
Barclays, was fined twice for selling completely unsuitable investments to
its clients. In both cases, customers' satisfaction was clearly damaged. What
kind of partner were they relying on?
For Danielle Paffard, campaign manager of "Move your Money", banks
began failing their customers a long time ago. Banks have lost their customers'
trust. They constrain loans to small businesses and domestic economies, while
awarding giant bonuses to their directors and pouring clients' money into risky
speculation and dirty businesses, like tax heavens, arms companies and fossil
fuel industries responsible for a range of social and environmental crimes.
Plenty more fish in the sea
Considering these activities, it
seems obvious the big banks are scoring very low in ethical rankings. The British
Consumer gives financial services such as Lloyds, RBS and Santander between
0.5 and 4.5 points in a scale of 20.
However, there are alternatives.
"Move your Money" encourages people to put their money (current accounts, saving
accounts, mortgages) into more ethical and socially useful financial institutions:
ethical banks, building societies, credit unions and community initiatives,
Inspired by the Occupy Wall Street Movement, it
is the British version of the American campaign that got 10 million people in
the US to move their money into local financial institutions.
people to give
their pledge and make the change this March, during the Move your Money
month. But it is also an opportunity to promote a deeper cultural change, raising
social awareness about alternative banking and pushing the debate.
of the most important building societies and credit unions in the UK are in their
thirties but they are not so well-known as famous big banks. Danielle Paffard
points out that the main problem is people do not know there are alternatives.
The other drawback that is often leveled at these ethical financial institutions
is unfounded: "When people get to know these alternatives it is still difficult
to change. For example, people think the process of moving their money is going
to be annoying and it is going to go wrong, and I suspect in the past there was
some truth in that, but now it is very simple".
No blind love
Unlike big banks, co-operative and mutual solutions have proven their resilience
and honesty in crisis times but it is difficult for them to attract new customers.
"Nothing is perfect", admits Danielle, "but there are much better than
what we have got already and they are all good in different ways".
These alternative institutions get better
ethicscores but there is still a lot to do. Some of them can also pay
significant bonuses to their executives; and others either offer very limited
services - e.g. just saving accounts and loans, not current accounts - or need
to expand their network of branches to cover equally the whole country.
"Move your Money" does not expect people to serve divorce papers to their current
bank by withdrawing all their savings overnight, but aims to enable people to
weigh up all the available options and shop around for a more satisfying engagement.
The campaign manager concludes: "Move your Money is not going to break down
the big banks - and it is not indeed what we want to do because they are perfectly
capable of breaking down themselves, but it is about using our consumer power
to bring something better".
Your cup of
The alternatives are various. "Move your Money" website offers
detailed information about these alternative financial institutions with both
their advantages and disadvantages. These are some quick ideas:
banks aim to create social and/or environmental benefit as well as profit.
Each bank has a different ethical focus and level of commitment but they get better
ethicscores than conventional banks:
the Co-operative Bank (13/20), Triodos Bank (15/20) and Charity Bank (17/20)
are some examples
- Building Societies are
mutual organisations owned by and run for the benefit of their members
- their customers. They beat the big high-street banks on all measures of customer
satisfaction according to the Building Societies Association. Nationwide
(12.5/20) is one of them
- Credit unions are financial
co-operatives, democratically owned and run by their members. They
tend to be closely involved with their local communities. "Move your Money" highlights
London Mutual, Bristol
Credit Union and Manchester
- Community Development Finance Institutions
(CDFIs). Small, local organisations whose primary mission is to support communities
by providing affordable finance that would otherwise not be available, like
London Rebuilding Society
- Other innovative schemes that enable
customer to lend and borrow directly from other individuals and allow them to
choose directly where their money goes. Examples: Zopa