The Bank That's Fair

Speaking of Black Swans and risk in retail financial services, I just happened across What Were the Credit Card Companies Thinking? on the Harvard Business Review blog. HBR emphasises the point that you can choose to keep ripping people off, but it's inevitable that your business practices will be rendered unsustainable by regulation or customer revolt.

Some might say the predictability of that means it's no longer a "black swan", but the card issuers seemed oblivious or in denial. Like the turkey that's expecting another meal after being fed for 1000 days, only to get eaten. Or like an MP preparing to file another expense claim...

My bet is that this process of exposure and elimination will happen faster and faster as the social media continue to grow and the ripples of influence become more pronounced.

Which reminds me, the House of Lords is due to hear the latest appeal in the bank charges litigation later this month... Will the banks battle on to their death, or see the value in conceding customers' entitlement to refunds?

Event Promo: Role of Social Media in Financial Services

On 16 June, the Financial Services Club is hosting a discussion about the role of social media in financial services. A senior central bank spokesperson commented that the event should be of special interest to banks:

If you wish to attend, members should register here and non-members should register here. Non members are invited to attend this and other events at the special rate of £95.00, plus vat, refundable if the individual subsequently becomes a member of the Club. Drinks and canapés are included and there will be an opportunity to network.

Lessig: How Money Affects Political Trust

Some prescient remarks, made in the context of political donations, which apply more directly to the cash-for-amendments scandal but also suggest the reason for our concern over MPs' attitudes to expenses:

Hat-tip to Paul Miller.

The Story of Zopa

Giles Andrews, Zopa's Managing Director, explains how the social lending marketplace evolved. Hat-tip to P2P-Banking.

Giles Andrews from Zopa from The IPA on Vimeo.

Swinegate and Consitutional Reform

I've just seen some patronising rubbish in the Spectator about concern over MP's expenses being overkill and somehow bad for the British democratic process.

Swinegate is just the straw that broke the camel's back. At different times, on different issues that each of us cares about, we have all felt that politicians are up to no good in their various machinations. Now we've all caught them, red-handed, pulling the same stunt at the same time. It does not matter that we have merely caught a crowd of them failing to do something as basic as filling out an expense form with diligence and propriety. The panic-stricken response right across the political spectrum is clear evidence that the politicians now know that we know just how opaque and unaccountable Parliament is generally.

The great news is that this has alerted a wider community of people to consider what goes on in Westminster. But these are still early days in this process of awakening. So it's way too early to constrain debate by saying that constitutional reform is not the answer, for example. Let's get the whole sorry parliamentary institution laid out on the table and then figure out how to reform it.

More light, please! We have work to do...