Is this a good time to talk about the daylight ‘robbery’ going on around us?
A few days ago, I needed cash and popped into one of the ‘malls’ in Kampala’s suburbs. My bank’s ATM was out of service so I tried the other three machines: One declined my bankcard; the other two indicated a fee for the privilege, despite claiming to accept Visa cards.
I had three options: One, drive to my bank’s nearest alternative ATM three kilometres away which, being rush hour, meant at least an hour sitting in traffic. Two, move the money – Shs600,000 – out of the account, onto my mobile, then withdraw it. I chose option three – take the money out of the other bank ATM – because it appeared cheaper and faster.
Not by much, as it turned out. The other bank hit me with an access fee of Shs7,318, but I later discovered that my own bank, having failed to keep its ATM online and in good order, had also penalised me Shs5,000 plus Shs750 in tax for having the temerity to use my card in another bank’s ATM machine.
The transaction cost Shs13,068 – a 2.1 per cent tax to access one’s own money. Mobile money would have cost Shs17,260 (2.8 per cent). While these might seem like small sums to some, they quickly add up into a daily daylight heist.
Other examples abound. Consider the retailers, restaurateurs and hoteliers that surprise you at the time of settling the bill with the announcement that card payments come with a charge. A few are dishonest enough to inflate the merchant fee charged to them by the banks from, say, 3 to 5 per cent, while punishing customers who are saving them the headache and cost of cash management.
Paying just over a dollar (Shs3,950) to settle a utility bill of Shs150,000 saves you having to queue up at a branch office, but this should be a win-win benefit from technology: Savings the utility makes from not having to employ cashiers or cash-in-transit vans should help lower the tariffs, no?
Yet, as irritating as these costs can be, they are nothing compared to the pre-payment hit customers take from telecommunications companies.
If I buy a 10-gigabyte data bundle, the telecom will cut off my Internet access as soon as it runs out, fair enough. But if I use only half, why should it ‘expire’ at the end of a time period?
Is there a dumpsite on the outskirts of the city where telecom workers can be found, hard hats and reflector jackets half-visible in the midnight darkness, holding their noses as they throw away expired data and voice bundles?
Of course not! The data and unused voice minutes are simply repackaged and resold. What happens to the money received for goods returned unconsumed?
Both industries can – and should – be regulated better.
Encouraging telecoms, whether by carrots or by sticks, to share mast infrastructure reduces industry-wide costs allowing lower prices for customers and competition on quality and service, not just availability.
Can banks, many already operating out of the same agency banking spaces, be pushed in the same ATM infrastructure direction?
How about requiring commercial banks and micro-finance lenders to advertise not just the base interest rates on their loans but the real annual cost when all charges are factored in, as is required in many other countries?
In fact we need not reinvent the wheel, even on data and voice bundles.
In many countries regulators, under pressure from consumer protection bodies, require telecoms to notify customers when their bundles are almost and fully depleted.
Customers who renew or top-up before the expiry in most cases get to roll over unused data and voice. This ensures the telecom gets more revenue (pay to keep it) without leaving the customer out of pocket.
It also means customers do not unwittingly go from using a bundle to notoriously expensive out-of-bundle rates. Customers nearing the end of their validity periods and who do not wish to renew their bundles should also have the option to give them away. Those who renew should have the option to use up the old bundles first. It is not rocket science.
Banking and telecoms are not the only industries in which consumer rights should be protected better.
Airlines, for instance, can be opaque and high-handed in compensating customers over delayed flights and missing luggage in countries with weak regulators, then act all nice and caring in the highly-regulated EU market.
But while one can survive without ever having to step foot on a plane (or, for that matter, a pleasure boat), it is almost impossible to avoid the Telecom Man and The Banker. Ensuring transparency and fairness in what they charge is the least we can do for citizens already condemned to the Tax Man’s noose.
Mr Kalinaki is a journalist and a poor man’s
freedom fighter. [email protected]
Twitter: @Kalinaki.
