I got an email from Xero today advising that Westpac customers can now have their bank feeds automatically brought into their Xero accounting software (this has been available from the other banks for some time now). Eagle eyed readers will remember that Westpac is the bank behind the destined-to-failure community site the Ruby Connection. The fact that Westpac is the last bank to actually sort this out (and technically it’s not a big deal to implement), makes me put them down the bottom of the list in terms of banks who “get it”.

Most banks realise that readily accessible banking is a benefit to customers and shows an awareness to actually react to their customers in truly user-focused as opposed to PR-focused) ways. But no, Xero has to inform customers that;

Please note that Westpac charges a $25 bank fee for establishing the automatic feed (the Westpac fee appears on your next Xero invoice

This raises two points in my mind;

  1. Would it not be worthwhile for Xero to cover this cost to both increase uptake and also build loyalty among their customers
  2. More importantly how can a bank justify charging what is in essence a punitive fee for users who are making changes to reduce the cost of being customers – it doesn’t make sense

So for me the takeaways from this situation are that banks really don’t get the changing paradigm within which they operate, and that SaaS vendors need to do everything they can (and more) to mitigate the damage done by recalcitrant third parties.

Ben Kepes

Ben Kepes is a technology evangelist, an investor, a commentator and a business adviser. Ben covers the convergence of technology, mobile, ubiquity and agility, all enabled by the Cloud. His areas of interest extend to enterprise software, software integration, financial/accounting software, platforms and infrastructure as well as articulating technology simply for everyday users.

  • Gripnostril |

    "Shey don't get it"…or perhaps more to the point, when they finally get it, we've all moved to something else away. Banks generally appear to take the approach of laggard, though, as noted, given any opportunity to charge, they will. The fee for using a teller, since they'd prefer you to use an ATM, of course there is also a fee for using the ATM…presumably as they prefer you to use the competition..at this point that still, unfortunately seems to be the mattress. It's not surprse Westpac is last to implement and "get it", this is generally the annual winner of the ?worst bank of the year" award.

  • What a rort. One thing of interest, if you do a bit of digging around as to where the lawyers who used to work in the Telco sector are now starting to pop up… Banking. I've also heard that there a re a couple of clauses in the credit finance act (i think its that one) that show an increasing intent to regulate. When you think about what banks actually do, they could easily be disrupted. Credit risk and distribution…. others can do the distribution

  • The same for banks who offer the on-line statement only option – but don't reduce your fee if you do it. Or banks charging a "establishement fee" for self-service on-line payment creation. What? Would they rather see you queueing in the branches? Anyway, I agree this should be free from the bank or covered by Xero. It's just another entry barrier.

  • UM, "when you think about what banks actually do" exactly what we should all be doing before the taxpayer has to bail them out (again).

  • Justified – no I didn’t unfortunately – you?

  • No Ben, did not make it along. Seems from the presentations that there was nothing significant announced… and to respond to the Westpac problem ($25) if Xero were to cover this themselves it would set a bad precedent. Westpac have really dropped the ball on this one, gives them a really bad image being the only bank to charge these absurd fees

  • Phil Wheeler |

    Stuff actually ran an article last month on the top 20(!) pet hates consumers have of bankers: http://www.stuff.co.nz/4599630a6445.html. “>http://www.stuff.co.nz/4599630a6445.html. Westpac's "little earner" seems too high even for a bank to justify however! I'm the web developer for the National Bank site and I have a lot of initiatives I'm really eager to see applied, however banks by nature are risk averse and money-focussed. I find it very frustrating sometimes dealing with an organisation whose individuals might see the merits in taking a certain path, but for political, cost or other reasons are collectively unable to follow through on that path. Changing a long-established paradigm is no fast process. To the individual, a course of action might be blindingly obvious, but once the formal business case is written, passed through committees, edited, more committees, cost-benefit analysis… well, many might understand why large institutions seem slow to adopt new ideas.

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