Such was the case in a letter that arrived today from a certain globally competitive retail bank with which we, until next Monday morning at least, hold an account. The bank in question was one of the four foreign first-mover banks to gain the right to offer RMB retail banking services to Chinese citizens earlier this year, after previously being restricted to issuing RMB accounts to foreign nationals in China.

Now, it seems that this particular bank is raising the ante as it seeks to cherry pick its clientele, and deliberatly lose those who don’t meet its high deposit criteria.

We quote verbatim below from the letter received (dated simply as: “Sept 2007”):

“Our tariff of Account and Services for Personal Customers has been updated with effect from 20 April 2007. Minimum total relationship balance (TRB) for your account will be amended to RMB100,000 from existing RMB16,000 with effective from 20 Oct 2007 while the monthly service fee will also be amended to RMB150 from existing RMB55 at the same time if the combined monthly average account balance falls below the TRB.”

Let me just repeat that:

•    The minimum total balance, including RMB and foreign currency deposits, has been raised – not “amended” – more than six-fold, from RMB16,000 (USD2,130.20) to RMB100,000 (USD13,313.80).

•    And the fee for failing to meet this sharp minimum requirement hike has been almost trebled – not “amended” – from RMB55 (USD7.33) to RMB150 (USD19.97).

Of course, any rightfully minded consumer, whether they reside in China or anywhere else, would be enraged at such a strategy. But, wait, there’s more.

In red – yes, red – type, the letter continues:

“According to our record, your average TRB in Aug is below RMB100,000. Please fund your account by 20 Oct 2007 to avoid unnecessary charges.”

Let me repeat again: “unnecessary charges” of RMB150 a go.

We plan to carefully avoid “unnecessary charges,” by heading to the bank first thing on Monday morning and closing our account.

And, once we've done that, we will recall this example every time we hear a foreign CEO bemoaning the fact that there is no brand loyalty from consumers in China. What goes around comes around – if service companies demonstrate such abject loyalty to their own customers, how can they expect consumers to respond with the craved-for unswerving faith?

The answer is they can't.

Last update : Friday, 14 September 2007

Keywords : Banks, Shanghai, Financial Institution, Loyalty, Brand

Average user rating

   (0 vote)