Banks seem to be constantly restructuring with an aim to reduce costs. Outsourcing to call centres in the UK, or even different countries such as India, where salaries are much less, seem to be the trend. Laying-off experienced staff is on the increase, with customers being moved to lower cost service channels, using call centres or the internet instead of using bank counters and individual relationship managers.
The impact on farm businesses
This applies to farming business as much as it does to personal banking or other commercial banking. There has been a reduction in the number of agricultural relationship managers in some banks. With this could come a loss of farming experience and understanding. Many managers are now managing farming businesses alongside other commercial business. These businesses often don’t compare with the longevity and cyclical nature of farming, or with the motivations of farmers as they seek to secure their place of work and home
Those businesses that offer a higher value potential to the banks or those with higher debt are often still managed on a more personal level. With fewer bank managers looking after those customers who don’t borrow too much – but who perhaps have the greatest capacity to borrow - the potential lack of face-to-face advice when these businesses seek to increase debt levels or borrowing significantly for the first time will be important.
This makes the roles of advisers, brokers and consultants increasingly important – particularly those with the knowledge and experience to prepare a quality farm lending proposal or credit presentation fit for an underwriter.
Lending has become more rule driven and more about the numbers, and less about the judgement of the borrower’s character, farming ability and potential. This is perhaps partly because of reducing relationship managers with the ability to visit farms regularly to make these assessments. With no existing relationship, there is less confidence in the interaction between the customer and the bank.
Don’t be afraid to voice your opinion
If a farmer is losing their bank manager or is not happy with their new or current manager or call centre relationship, then you should not be afraid to voice an opinion. It is fair to say we all get along better with some people and less well with others. Banks do occasionally take that into account and offer a different relationship rather than lose a customer. This will become more difficult as less managers exist but certainly it is not impossible to achieve.
Switching is easier than you may think
The alternative is to consider moving to another provider and that opens choice and a fresh start in many ways. This is where R &BS can add value. We can help find the right bank and the right person to suit the individual. The banking industry has made it much easier to switch banks and that process should hold no fears - to an extent you are just buying money in the same way as you buy insurance.