Founder, President & Executive Dean of Nobel International Business School (NiBS), Professor Kwaku Atuahene-Gima is proposing the establishment of an agency which will promote the cause of bank customers who suffer abuse.
The agency will demand compensation for customers from institutions which abuse their trust and confidence.
“When customers are given a raw deal or abused by a financial institution, they will report to this agency which will then write to the institution and demand compensation for the affected customers,” he explained.
Speaking at the School’s maiden breakfast meeting on the theme ‘Rebuilding trust in the banking and financial services industry, at the NiBS campus in Accra, Prof Atuahene-Gima stressed: “we need to be creative and see how we can transfer power into the hands of customers.”
The meeting pooled economists from the University of Ghana Business School, the Institute of Economic Affairs (IEA), representatives from the Banking industry as well as the Securities and Exchange Commission (SEC).
The distinguished Professor of Innovation Management & marketing said his school was ready to provide direction through research and discussions to concentrate a lot of power in the hands of the customer to restore trust in the country’s banking and financial services industry.
Ghana, a low trust society
According to Prof Atuahene-Gima world-wide research had identified some countries as low trust societies and other as high trust societies.
“If you consider the parameters under which the study was done and discussed, Ghana is certainly a low trust society because people can cheat the system and go unpunished,” the NiBS founder said.
He pointed out that people take the law into their own hands because they don’t trust the system.
“Paradoxically, in a low trust society, trust becomes really important but in a high trust society, it is not that important because if someone is cheated or abused he or she has recourse to redress,” he added.
According to him, the problem of mistrust needs creative solutions, saying “ it’s not just about regulation; you may have a tight regulation but when customers believe and know that regulation is tight the bankers take advantage and use that to cheat. This is because the customer trusts the regulator.”
He agreed with some discussants at the meeting who argued that the regulator had to adopt the method of naming and shaming institutions which are found to have abused the trust of customers.
Economist, Prof Eric Osei Assibey urged the Bank of Ghana to speed up the formulation of the deposit insurance policy to protect customer funds in the midst of the banking crisis and the collapse of financial institutions.