Ethics of bank sales targets questioned

Finsec is pushing for an investigation of banks' sales practices. Photo / NZ Herald

Bank sales targets and techniques have come under fire after a survey showed workers were concerned about pushing products on customers who could not afford them.

A trans-Tasman survey, conducted by New Zealand bank staff union Finsec and the Finance Sector Union in Australia, showed 25 per cent of workers were uncomfortable about their customers being able to meet financial obligations of the products.

Sixty-three per cent reported their targets went up annually, and 77 per cent said their employer did not reduce their targets when economic conditions were more difficult.

As well as the ethical problems of selling unaffordable products to customers, Finsec spokesman Andrew Campbell said workers had reported concerns about how they were told to sell them.

"It's a very practised and systematic approach to the selling of these products, and no stone is left unturned in relation to it," Mr Campbell told NZPA.

"I've had a bank worker say to me that they were closing the accounts for someone who was deceased for the family, and the manager said to them afterwards 'why did you not try to sell them life insurance? It's a perfect time, a recent death in the family, to emphasise that product'."

Mr Campbell said the scare tactics were not new.

"What is not normal is that bank workers, up until now, have been reluctant about talking about it, but that's changing," he said.

"Both our customer and worker survey shows that there is clear opposition to these target systems. Customers don't like the deceitful, secret way in which bank staff are expected to sell them products, and bank workers don't like having a dishonest relationship with their customers."

Mr Campbell said Finsec was pushing for an investigation of banks' sales practices.

There were no written guidelines for the promotions, and often the "less-than-ethical" practices were driven by individual managers, he said.

"We think that, at a minimum, all the banks need to sign up to a charter which prohibits the worst aspects of these practices, and we think that targets need to take into account the concerns of the economy.

"We're not saying 'we want targets gone tomorrow', we understand that will probably have to be systematic, but we think there can be a much fairer system that is not about pushing debt on to customers and stressing out staff in the process."

- NZPA