Sometimes I really have to wonder if the Caribbean can’t do any better. And, in this case, can Caribbean Banks do better?
I came across a back and forth conversation on Facebook about the implementation of a ~$9 US fee to savings accounts at the Royal Bank of Canada – St. Kitts Branch, less than a week before the May 23rd, 2016 effective date. Keep in mind that less than a week is not a lot of time to move your money to another bank as an overseas customer, (it took me 3 days just to get a customer representative the previous month) and would mean even longer than usual lines for customers locally.
INADEQUATE NOTIFICATION BY DESIGN
For Commercial Banks in the Eastern Caribbean Currency Union (ECCU), there is no regulation specifying the manner in which nor the period over which customers must be notified before new account fees take effect. Royal Bank’s regulator, the Eastern Caribbean Central Bank (ECCB), even issued a press release that emphasized the limits of its power to regulate Commercial Banks’ account fees.
The Eastern Caribbean Central Bank (ECCB) is concerned about the increase in
commercial banks’ fees and charges across the Eastern Caribbean Currency Union
(ECCU) and the effects on depositors.
By law, what the ECCB has power to do, when it comes to Commercial Banks operating in the ECCU, is to:
[R]egulate the minimum savings rate, that is, the minimum interest rate paid on savings deposits.
The long and short of it is that the, ECCB, the regulator of Commercial Banks, including Royal Back of Canada, can’t, legally, tell them nothing. But the ECCB encourages Commercial Banks to be transparent with their customers and properly inform them of new fees. We all know how all that encouragement turned out…customer, confusion, protests, and 4+ hours long waits in bank lines….
Related Post: Featured: CBC Canada News, Royal Bank sparks backlash with fee hikes in the Caribbean
Caribbean Banks Can Still Do Better
Banks have to make money, and if instituting fees is required for their survival, then customers can vote with their dollars and bank elsewhere (or sadly, in some cases. not at all). For Royal Bank of Canada’s roll out of new fees for savings accounts, your ECCU customers in the region and the Diaspora were not adequately notified and it should not take
a law to extend that courtesy. Well… maybe it will, since encouragement from the ECCB has not had much effect.
Posting a notice of new bank fees within the Bank Branch and, three pages deep, on RBC -Caribbean website should not represent the standard of service for a leading, financial institution in the region.
Next time around consider:
- Notifying each customer individually in writing via the mail;
- Notifying customers electronically, via email;
- Providing options for customers to close accounts (via the phone and online); or,
- Providing options for transfer of funds from closed accounts to customers or another financial institution of their choice.
If you are an RBC customer in the Caribbean affected by the new fees, how did you find out about them? Do you think there should be specific regulation or banks and/ or notification of new fees to customers? Let me know in the comments below.