RETROWURST: Money February 2006

 

Today I discovered a lost world. That of German banks eighteen years ago. Things have changed and not necessarily for the better. Take a time-trip back to my Extrawurst from February 2006 and discover why Kredit was one of the dirtiest words in the German language. The Germans have plenty of new dirty words these days, mostly stolen from us or our US friends, which is not encouraging. Back then, I wrote about the big banks with their impressive Frankfurt skyscrapers, and their intimidating but competent advisors. The reassuring air of stuffiness and formality, coupled with the persistence of the personal touch, the reluctance to go online and digital with it all.

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The time has come, today, to tackle one of the dirtiest words in the German language. It’s not the word Scheiße or Schweinhund but a rather inoffensive looking and sounding little six letter word: Kredit. Along with looking at the reasons why this is a word so loaded with negative meaning, I’ll have a go at trying to get behind some general German views on all things money and finance.

 

I used to live in Frankfurt where one of the defining features or iconic elements is the skyline, which is dominated by Frankfurt (and Germany’s) leading banks, all vying with each other to see who can build the tallest skyscraper. Since the late 1990s, the Deutsche Bank, Commerzbank and rivals have also been joined by the European Central Bank, the spawning ground (if you like) of the Euro. It is actually quite difficult to get away from money in Frankfurt: on every corner is a bank or at least a Geldautomat and even if you do escape to one of the Olde Worlde Apfelwein pubs in Alt Sachsenhausen, one quick glance skywards will bring you back to the world of money, even if your neighbours at the table aren’t bankers (which would be unusual.).

 

The German banks, particularly the “big boys” such as the Deutsche Bank (www.deutsche-bank.de ), Dresdner Bank (www.dresdner-bank.de ) and Commerzbank (www.commerzbank.de) tend to be, on the surface, somewhat intimidating and less immediately approachable than their UK equivalents. One still gets the feeling, which is reflected in their web presence to some extent, that there will be no chummy banter here and one should really put on a suit when going to the bank, even if it’s just to make a simple money transfer. Although the big banks have moved with the times to some extent, there still seems to be some feeling of stuffiness and formality. However, one can sense a pattern here that is very similar to that of relationships in general in Germany: these tend to develop slowly, step-by-step, until the no-turning-back-friend-for-life stage of “du-sing” is attained. 

 

Although one doesn’t get all the chummy, jokey, for-God’s sake we’re-not-boring-and-we’re gonna-prove-it attitude of UK banks in Germany, we also don’t get the call centres and never speaking to the same person twice that we are beset with in the UK (I know, I still have a UK bank account.) In Germany, everyone has an advisor assigned to them at their own branch, with a direct phone line, regardless of whether you have a couple of thousand Euros or a few billion. These advisors really do get to know you and your preferences when it comes to accessibility of your money, what kind of investments suit you and what your future plans are, which is particularly important in a country where everyone is rapidly having to seek alternatives to the state for health insurance, pensions and the rest.

 

While the big three banks dominate the skyline of Frankfurt, most Germans actually have their account at the local Sparkasse or savings bank (www.sparkasse.de ), Volksbank or Co-op bank (www.volksbank.de ) or the Postbank (www.postbank.de ). While these banks may be a little less intimidating than the big three, they are never-the-less places of seriousness and formality. In fact, when Germans are asked about which qualities or values are important in choosing a bank, trustworthiness, serious and solid reputation and flexible to my personal needs are the top three criteria, with modernity and friendliness seen as “nice to have” but not critical. 

 

Although the banks do seem to have moved with the times, the use of services such as on-line banking is still relatively low in Germany and the idea of physically visiting the bank to make transactions still a very popular one. Even cash dispensers seemed to take longer to catch on here and one feels that there is a huge underlying mistrust of finance and banking conducted by anything other than real people.

 

This brings me on, of course, to that dirty word: Kredit. While things have improved over the last ten years, when I first came to Germany, I was astounded by the unacceptability of plastic generally. To buy a major item, one either had to pay in cash or write out a number of cheques, each of which had a maximum value of DM 400 in those days. Credit cards were scorned and frowned upon almost as much as if one came up with a begging bowl. Again, the distrust seems to stem from a very direct relationship that Germans seem to have about money: carrying large wads of cash around or openly discussing with strangers the cost of your house or car are not seen in any way as vulgar displays but rather as an honest, straightforward approach.

 

Credit cards are still barely accepted today. Visitors to Germany are often surprised and embarrassed that restaurants turn their noses up even at Mastercard and VISA. And the Mastercard and VISA cards here tend to be cards that are paid off within 4-8 weeks, so not real credit cards at all! Mastercard did themselves no favours with the German public by making the World Cup tickets draw only accessible to Mastercard holders. However, a step in the right direction, to win the Germans’ trust in plastic money has been made in the last few years with the introduction of the “ec card”, a form of direct debit card that doubles as a cash card that is issued by most banks. But to think that this has only been in general use for the last 5 years or so is astounding.

 

Part of the disgust for credit cards may well come from the fact that they are seen as coming from profligate and decadent lands, such as the US and UK. Perhaps if one of the big German banks could introduce a very serious, trustworthy and solid credit card (maybe made a bit thicker than “your flexible friend”) that signaled control and financial acumen instead of profligacy when you took it out of your wallet, they could be onto a real money-spinner.

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Things probably started to go sour in that fateful year 2008. The Dresdner Bank was acquired by the Commerzbank in May 2009. 

What do we have now? Blowing up cash machines seems to be a national hobby. Bank branches are disappearing faster than tigers. I’m reduced to asking for cashback at the supermarket more often than not. While Covid speeded up the move to a cashless society, there are plenty of flies in the ointment - local independent shops and restaurants who don’t take cards - and who can blame them?

I’m still hanging on in there with the Commerzbank in the hope that things will get better, but I’ve been let down by them far too often, with the resulting loss of trust. Frying pan and fire come to mind.

Still, things aren’t quite as dire as they are in the UK. But that’s another story. 

Time for altered images?

 

The last couple of times I’ve signed on to my internet banking with Commerzbank, I’ve had a lovely little seasonal surprise. The visual, above, drawing my attention to the bank’s Christmas charity drive. They have partnered with brotZeit e.V , an organisation that provides free breakfasts for schoolchildren. And, sad as it is, there are plenty of children in Germany at the moment who could benefit from this charity.

Why am I commenting on this? Well, the visual itself is striking and eye-catching, with its healthy snacks in the guise of seasonal characters. Pictures do paint a thousand words and fun, hope, cheerfulness, children, health, colourfulness, yumminess, friendliness, cosiness, kindness, imagination and creativity are just a dozen to start with. This is so much richer than the type of visuals that usually confront me on opening the website.

Typically in the last year, these will either be the usual grinning plastic people looking thrilled and excited over their laptops. Or pairs of said plastic people smooching. I’ve written about these plastic people here, and I don’t think it needs repeating. 

What I wondering is - in the obsession with representation, diversity and “people who look like me”, have we forgotten the power of the abstract and the symbolic? Long, long ago, we handled the Commerzbank account at Saatchi. We created a striking look, and from what I remember, there were no visuals of human beings. Everything was symbolic, from squirrels to oak trees. And plenty of less expected, yet rich, evocative imagery, too. 

Why does everything have to be so literal? Surely communication works harder when the visual is not merely a reflection of the text? The problem with using the thrilled and excited plastic people is that everyone else is using them too. Within the banking category and without. 

Advertisements from the golden age of posters are now regarded as art. 

Isn’t it time to give the thrilled and excited plastic people and their laptops a rest?

Whose money is it anyway?

 

One of the areas where I’m pretty sure my age is showing is my sadness in the decline of bricks and mortar financial and related services. I’ve written about some of my experiences involving my UK bank here and here, and I fear the situation is going to get worse before it gets better.

The pandemic has provided a perfect hatching ground for yet more fraudsters and dodgy schemes intent on getting their grubby mitts on unsuspecting people’s money. I heard recently about an acquaintance who very nearly parted with a huge sum in the direction of fraudsters doing a very good impersonation of the Allianz. 

The sad fact of the matter is that it’s difficult to trust any organisation when you can’t see their offices, or the people working there. The internet is smoke and mirrors in digital.

The situation in Germany is nearly as bad, although I do at least have an advisor/contact person assigned to my account who I’ve met in person, although I suspect that’s a rare privilege as I’m self-employed. Less cheering is the knowledge that, due to Automatic Exchange of Information, UK institutions are passing all sorts of info about me to to the German tax authorities, which would be all well and good if there was some way of finding out which information was being passed over, and a way of checking if this information was correct and relevant - clue: it isn’t always, as I have found out to my cost. 

I know it’s not easy for the banks. The high street branches are a huge cost drain, and they are kind of trapped between security on the one hand and providing good custmer service on the other. But surely this is the kind of challenge that, if you get it right, you’ll really rise above the others and profit?

My experience of banking is that there are more and more hoops for me to jump through now to get anywhere near my own money, yet it’s also increasingly difficult to get to talk to a human being when I really need to - and no, I don’t want to chat on Facebook about financial matters. With the advances in technology, this makes no sense whatsoever.

I’ve got used to the tangle of user names, passwords and memorable information to get me past Go. I am even coming to accept that every second time I want to bank online I’ll have to utter a four digit code at a machine (and that worryingly often, it’s not accepted). But yesterday, I encountered something new. I wanted to move some money from my bank account to the NS&I, where I have Premium Bonds and a couple of other savings bits and pieces.

As I attempted to do this, a grid with about nine little icons flashed up at me.

"Why are you doing this?” demanded the grid.

I was quite taken aback and had a quick look through the options. “Moving my money” seemed to answer the question. Immediately another pop-up in red told me that the bank would never ask me to move money, which was odd as it was nothing to do with the bank, rather my own free will. But choosing this option resulted in not being able to get any further.

I wish I’d done a screen shot of all this as I can’t remember what else there was, but eventually I picked “Savings and investment” which seemed quite safe, but also came with dire warnings about fraud, and had I checked out the company I was investing with, and so on and so forth. I did think briefly about the guy and the Allianz-masquerade, but really. NS&I?

All in all, what should have taken a few seconds took considerably longer and left me irritated and almost as if I’d tried to do something illegal, or ill-advised, or naughty. 

And, strangely, I wasn’t asked to “rate my experience” on this occasion. I wonder why. 

 

Smiley stars or advisory council?

I've been reading a few reviews of the new book by Andrew Keen, The Internet is not the answer and I must say that I feel inclined to order and read the whole book. The big question is - do I do it over amazon?

One of the big themes of the book is that the openness of the internet has, ironically, compounded economic and cultural inequality, and has created a digital generation of masters of the universe. For all its convenience and benefits that I have enjoyed on a personal level, there is no denying that amazon has destroyed markets and exploited many of its workers.

Despite the talk about the internet facilitating our need for connectivity, it seems more and more apparent that an increase in the breadth or quantity of connections has been at the expense of a decrease in depth.

When it comes to the big internet-based brands, many of these have such pared-down staffing that it is almost impossible to connect to another human being for queries outside the normal FAQs. I recall an incident involving PayPal a couple of years ago where the only way I got my worrying query attended to (someone had hacked into my account) was by sending a letter via the postal system to Luxembourg!

Brands make a big deal of "being customer-centric" and "listening to their customers" but all too often this means one tick on a 5-point smiley star rating scale.

It was refreshing, however, to be invited to apply to be a member of the Commerzbank's Kundenbeirat the other day. Beirat is one of those strangely German words which is best translated as an "advisory council". This conjures up a vision of wise, respected people, whose opinion is sought. Not the type that are content with quickly ticking off a smiley star. The Commerzbank have been running their Customer Advisory Council since 2009. The members have a 3-year term of office and are involved in the development of banking products and services. I think it's a voluntary post, but they do get to meet the board of the bank - and to make a difference.

Better than finding out which toilet cleaner fragrance I am on Facebook, I think.