Saturday, 25 October 2008

Yeh Siang Hui, I'm ....

...Not surprise that you were out of touch with what actually goes on in the Bank nowadays. Due to technology advancement, many of us rely on self-automated deposit machine, self-update of passbook, quick cheque deposit, etc... hence we hardly make a trip down to the Bank.

The article, 'Mistake to pay investors not satisfied to park their funds in fixed deposit account' by Yeh Siang Hui, clearly illustrates how out of touch we can be.

Firstly, anyone that goes into the Bank has an intention. Clearly, the intention is mainly either to deposit or to do withdrawal. One often see the elderly or illiterate forming long queues in the Bank because most of them do not know how to use the self-automated machine provided outside. More often than not, when you are queuing outside to draw out some cash from the ATM, once in a while you can see an elderly man or auntie coming out from the Bank with a Staff who will then lead him/ her to the quick cheque deposit box. The staff will then explained that this is how easy cheque deposit can be nowadays. Sometimes you can sense that the elderly man/ auntie does not feel very comfortabe with putting it in, they always felt that its safer for them to witness it being processed over the counter.

From incidents as such, these people are very conservative and will not go into any investment products unless they had been introduced to it or they know of such investment instrument.

In most cases, when a customer purchased an investment product, it was introduced over the counter when he/ she is making her deposit, etc. That is the first contact point. The teller whom is not qualified to give advice because she has not got the mandatory requirement of CMFAS paper qualifications, can only give factual facts about the investment product. Factual facts are facts that can be found in the brochure. Because she cannot give advice, she will normally refer the customer to the 'Relationship Manager' (RM), who has the qualifications to do so.

It was from here, the product was explained in details to the customers, but how detailed I have no idea. I agree with Yeh that 'Take the risk, bear the risk'. What if in the first place the risk was not disclosed or not explained properly? If the risk was unknown, then can we still say 'Take the risk, bear the risk'????

Was these investment products sold like Fixed Deposit?
Did the customers who bought these products understand the risk-profiling test that they will need to do? These test were conducted in English.

The word 'greedy' mentioned in the article is to me something that everyone is guilty of.

When a customer walked into the Bank to do any other thing else except to buy investment products, no greed was present. They came with a task on hand, next the teller then introduce another product to arouse their interest. The RM who is the last contact point with the customer evoke the greed in the person.

Let's look at it from another point of view. The teller who introduces the product don't just introduce to anyone. Why do I say that? People who does not have much money in their bank account will not be introduce to the product. Next the RM who is paid a basic with a high target to meet for his/ her commission pushed for the sales out of greed too. Lastly, the institution who marketed the product acted on greed too otherwise why sell these products? Why not just stick to deposits and withdrawals? The greed to earn more.

Hence, using the word 'greedy' on the investors is unfair.

Of course, there will be people who are opportunist, who will jump into the wagon to claim that he/ she had been mis-sold too in order to get compensation. On the other hand, what if there are really genuine cases where the customers were mis-sold which I believe there will be(MAS is looking into it)?

I often hear friends from the Insurance industry telling me this,

"How come the Banks can use the word guaranteed and we insurance fellows use the word, sure kenna!"

"I lose my customer to the Bank lar, they bought capital protected but our insurance ILP cannot protect capital...but capital protected is still not guaranteed!""

"I'm quite scared to sell ILP to Chinese speaking customers because I need to use the Chinese fact-find form! How to explain the jargons in Chinese?"

These comments could be made casually but it tells us something, isn't?

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