Jeff Salway: Time we all called banks to account

By JEFF SALWAY
Published on 19/02/2012 00:00

ONE of the inevitable side-effects of writing about money is that eventually you realise you should try to practise what you preach.

There’s a limit to the number of times you can exhort readers to count their pennies, review their pensions, save more money, take their bank to task and cut up their credit cards before wondering whether you should do the same.

I try to avoid saying one thing and doing the other but only this week did I finally get round to acting on one step I’ve long advocated in my columns – moving my bank account.

Like many people I’ve only ever had one current account. I opened an account with Barclays when I was 18 and, having never had any real problems with them, I’ve not felt the need to take my business elsewhere.

There’s only so long you can ignore the other factors though. The bank’s failure to reflect sub-standard performance in the bonuses paid to its top brass, its mis-selling record – Barclays was last year fined £7.7 million and told to pay £60m in compensation to 12,000 older savers who lost out after being advised to invest in unsuitable funds – and investments in unethical and environmentally damaging projects are typical of the objections raised against most high street banks. And Barclays is one of the better ones.

So I finally made the switch, taking my custom to a smaller, more ethical alternative. Far too many people who get screwed over by their bank spend too much time venting their anger without actually doing anything constructive about it.

That could be about to change, however, with a campaign launching in the UK next month aimed at encouraging individuals and businesses to move their money from the big high street banks to more ethical or socially credible alternatives.

The Move Your Money initiative comes to the UK in March on the back of a US campaign in which an estimated 650,000 people moved their money in the four weeks leading up to 5 November last year, which had been designated “bank transfer day”. It claims to have encouraged more than 10 million Americans to switch from bank to smaller local institutions.

The Move Your Money website (www.moveyourmoney.org.uk) is promoting alternatives including credit unions, small building societies, the Co-operative, charity banks, Islamic banking and Triodos. The latter, a socially responsible bank that recorded a 36 per cent rise in lending to sustainable organisations in the UK last year, unfortunately doesn’t yet offer a current account, somewhat undermining the “move your money” argument. But it does offer savings and loans – using money raised from savers to lend only to enterprises that “create social, environmental or cultural added values”.

It has picked Edinburgh as the location of its first high street bank, which officially opens this week, and hopes to capitalise on growing demand for transparent, ethical and socially useful banking services.

The story is similar in the energy market, but even there change is afoot. The Big Switch campaign, aimed at using the collective bargaining power of domestic energy customers to negotiate a fairer deal with suppliers, is attracting 10,000 new supporters a day, it was reported last week.

What struck me when opening my new account was how different the attitude was. They didn’t try to sell me other products, the transaction was simple, the details transparent and it was made clear that the staff were not tied to sales-targets of the kind that have helped erode so much trust in our oldest banking brands.

It’s taken me too long to put my money where my keyboard is. It’s never too late though; by moving your money you can both support the alternatives to the status quo and make your own personal statement. Banks needs our money – if enough people turn their anger and dissatisfaction into constructive action the banking system will be all the better for it.