Bank workers concerned about customer debt levels
Bank workers are feeling under pressure to sell credit and other financial products to customers who cannot afford them, according to the Finance Sector Union (FSU).
The FSU is renewing its call for the selling of credit and financial products to be separated from remuneration following the findings of its Better Banking survey, which found that 90 per cent of respondents supported delinking sales targets and remuneration, while 43 per cent stated they were under pressure to sell debt products, even if customers did not ask for them or might not be able to afford them.
The survey results revealed that bank workers were under great stress and were concerned about their customers' debt levels, as they were under constant pressure to sell product, said acting FSU national secretary Wendy Streets.
She said workers felt they were unable to provide the level of customer service they would like to provide, with some showing concern that their customers would battle to manage their debt.
"This constant pressure that sales targets put on bank workers is why we are calling for the selling of credit and financial products to be decoupled from remuneration outcomes," Streets said. "The remuneration practices of banks are recognised as one of the major reasons for the global financial crisis."
She said all G20 nations should agree to eradicate remuneration-driven practices that are focused on short-term sales volumes rather than placing customer and community interests first.
"Workers also said they feel customer service is getting worse and is not a priority for their employers, and that they are made to sell more debt products to customers who don't ask for them and may not be able to afford them," Streets said. "Banks must stop these profiteering practices that put their employees and customers under increasing pressure. "
The survey revealed that 79 per cent of respondents said Australia needs tougher regulations to stop personal debt getting out of control and 82 per cent support new global rules to prevent high-risk banking activities. Some 73 per cent said their sales targets increased every year and only 4 per cent said targets were reduced if economic conditions deteriorated.
Recommended for you
ASIC has released the results of its first adviser exam to be held in 2025, with 241 candidates attempting the test.
Quarterly Wealth Data analysis has uncovered positive improvements in financial adviser numbers compared with losses in the prior corresponding period.
Holding portfolios that are too complex or personalised can be a detractor for acquirers of financial advice firms as they require too much effort to maintain post-acquisition.
As the financial advice profession continues to wait on further DBFO legislation, industry commentators have encouraged advisers to act now in driving practice efficiency.
