Not a week seems to go by without news of another leading bank teaming up with a major telco.To take this week at random: India’s largest telco by subscribers Bharti Airtel is in talks with the country’s largest lender State Bank of India about a possible joint venture.
Elsewhere, Italy’s UniCredit has snapped up a 6% stake in O2 Czech Republic (formerly O2 Telefonica Czech Republic) and is now the second largest shareholder in the telco.And then there are the go it alone telcos, dipping their toes into financial services.The latest is Rogers, the mega Canadian telco. It has obtained a banking licence, rolled out a credit card and a mobile banking operation, without teaming up with a major financial institution.
On the other side of the world, an interesting difference of strategy is playing out among banks in New Zealand.Westpac is in go it alone mode and has launched its own mobile wallet in contrast to rival banks that have teamed up with bank-owned POS operator Paymark and telcos Telecom and Vodafone.Closer to home, there is Weve, the MasterCard JV with O2, Vodafone and EE: its prospects of earnings its owners a return is an interesting topic for another day.
Whenever I sit through a consultants conference presentation urging banks and telcos to work together, I cannot help but recall Sixpack, the Dutch bank telco that belly-flopped.ABN AMRO, ING and Rabobank teamed up with KPN, T-Mobile and Vodafone in 2010; within a year, T Mobile dropped out but the other partners soldiered on until 2012. The JV collapsed in July 2012, with the parties saying it was all too complex and time-consuming to pursue their original ambitions.But the consultancy presentation I really take issue with is a recent one suggesting – and the lady was earnest and kept a straight face as she said this – that banks could learn a lesson or two from leading telcos customer service set up.The examples given: Isn’t 02 fab in the way it uses social media to assuage customer complaints when its service falls down.And account number portability………..If only banks would enable customers, like these worthy, service-oriented telcos, to retain their account number when they switch provider.On the contrary, there is a weight of evidence to suggest that telcos might learn a lesson or two from the banking sector.Take the 50 UK organisations with the highest customer satisfaction scores in the latest UKCIS survey: FIs to feature prominently include first direct (3rd), Coop Bank 8th and Nationwide, 15th. By contrast, Tesco Mobile (13th) was the only telco to make the top 50.
As a sector, banks and building societies scored a customer satisfaction level of 78.1% against 73.3% for telcos.Frankly, I am surprised the gap was not wider. Not too many banks would dream of rationing use of a popular channel: for example, ‘sorry, Mr B but you may only log onto your mobile banking service a few times a month’.
Telcos on the other hand ration the use of mobile data with their ‘Fair Use’ policies. Ask workmates at any desk about their customer service experience with telcos and you may be in for a lengthy litany of complaints.
I recall also that BT was in a league of its own in the latest Daily Mail survey, winning the Wooden Spoon for rotten customer service.So with respect to any consultant who is planning a presentation urging banks and telcos to get into bed, may I suggest that the banking bit leads when it comes to service.