This is the first in a series of interviews with financial services industry and government spokesmen about consumer protection issues.
Not many people know that the banking industry has had an ombudsman for several years.
That's probably partly because the position is combined with that of chief executive of the Council of South African Banks (Cosab) and partly because no separate report on the work done by the banking ombudsman is released.
The only reference to the ombudsman in Cosab's 1995 annual report is in three paragraphs entitled "Complaints Procedures".
By contrast, the short and long-term insurance industries each have a dedicated ombudsman with a legal background.
In the case of the long-term insurance industry, it is a retired judge, and for the short-term industry, an attorney with extensive experience in insurance cases. Each of these ombudsmen releases an annual report on what has been covered during the year.
The appointment of Norman Axten as Cosab's new chief executive and banking industry ombudsman from July 1 continues the banking industry tradition. Axten is a former head of communications at First National Bank. His predecessor, Piet Liebenberg, came from Amalgamated Banks of SA (Absa).
Axten said the main advantage of choosing a representative with a banking background is his knowledge of the banking system. The position of chief executive of Cosab could not be filled by someone who lacked credibility or impartiality.
Cosab is an umbrella body for five organisations the Clearing Bankers' Association, the Association of General Banks, the Merchant Bankers' Association, the Association of Mortgage Lenders and the Independent Bankers' Forum. The umbrella body represents about 50 banks, almost the entire industry. The first tenet of its mission statement is "to serve the banking industry".
Axten said one of the advantages of the link between Cosab and the ombudsman is that Cosab's members tend to accept the informal regulation of their own ombudsman.
"To date, on matters referred to the ombudsman, there has never been a dispute between the banks and the ombudsman which has not been brought to a conclusion that the ombudsman finds acceptable."
Axten said it was indisputable that the image of the banks in the eyes of some consumers was not the best. The many consumers that were happy with their banking service received less publicity.
"I think one of the problems is that the banks are conscious of bank/client relationships, and they will go to inordinate lengths not to talk about their affairs to the press.
"Unfortunately it is not so true of the other side. Customers can rush into print, and will say things that are their perspective of the truth, and sometimes not even that, and in the knowledge that the banks are not going to gainsay it. Often the banks suggest they will talk to the Press, provided the customer gives his authority, and it is amazing how often that authority is not forthcoming."
That sort of situation resulted in a "very lopsided position". However, the banks had done a poor job of explaining exactly what their role was and there was an element of mystery about banks which they had not done enough to dispel.
Axten acknowledged criticism of incompetence levelled at banks, but said the sophistication of the local banking structure was high by world standards.
South African retail banks served the public at a much lower level on the economic scale than banks in many other countries.
Axten said a very definite complaints' procedure was followed within each bank which ensured that each complaint reached the desk of a senior employee. The banking industry ombudsman will only become involved when a dispute has been declared between a bank and one of its clients. He will not become involved once legal action has been initiated.
Your first step, as a client with a complaint against your bank, is to try to get satisfaction at branch level; if that fails, at regional level; and, if still not satisfied, you should approach the head office write to the managing director, if you like.
Approaching the ombudsman is the next step. You should do so in writing, either by fax to (011) 836 5509 or by posting your complaint to Box 61674, Marshalltown, 2107. If you still feel aggrieved after the ombudsman's ruling, you could resort to legal action against the offending bank.