HSBC Take The Lead In Scrapping Bank Bonus Schemes
HSBC has become the second leading UK bank to scrap staff bonuses linked to sales targets in a move affecting 20,000 employees.
The move follows Barclays’ decision to overhaul staff incentives in December 2012 and follows widespread industry dismay over bank sales techniques that often overlook customers’ best interests.
HSBC said the new structure will impact on its own staff as well as its other brands – First Direct and M&S Bank – with sales incentives removed from all HSBC’s frontline staff in their 1,200 branches and call centres, with bonuses now geared towards consumer satisfaction.
The banking sector is attempting to rebuild its tarnished reputation following a number of scandals. Almost £14billion has been put aside to deal with compensation claims for mis-sold payment protection insurance (PPI) and recent research released by consumer watchdog Which? Magazine uncovered high levels of mis-sold mortgages, loans, credit cards and insurance policies across major high street banks with 45 per cent of surveyed staff saying they felt they were ‘expected to sell regardless of the customer’s benefit’.
The City watchdog recently warned that it would look to introduce new rules if the industry did not clean up its act with its use of incentive schemes, which it said were driving staff to mis-sell products to receive a bonus.
Hardwick Financial Solutions managing directorScott Sheedybelieves other banks will follow the lead taken by HSBC and Barclays.
“The high-pressure selling environment in UK banks is extremely unhealthy for the consumer who must be advised honestly and dispassionately so that they ultimately get what is right for them,” said Mr Sheedy.
“We have seen how much damage and distress mis-selling can cause customers and we strongly support the changes made by HSBC and Barclays and I’m sure other banks will follow suit.”
Financial Services Authority (FSA) managing director Martin Wheatley, who will become chief of new watchdog the Financial Conduct Authority, also advocated the steps taken by HSBC and Barclays and urged other banks to reform from top to bottom.
“When I speak to the bosses of banks they tell me they want to change, and this is good, but real cultural change will only happen if attitudes shift throughout an organisation — from the CEO to the front line sales personnel,” he said.
ABOUT HARDWICK FINANCIAL
Hardwick Financial Solutions Ltd cater for clients with complex, historical cases and also help in claiming back money that is owed to them – which in many cases is news to the client themselves.
They act for clients who have been hampered by mortgage mis-selling and fight their corner so they receive what they are rightfully entitled to.
They have long been recognised as one of the leading Claims Management/Financial Solutions practices in the UK and are highly regarded for their depth of knowledge and breadth of experience.
For more information visit: http://www.hardwickmissoldmortgages.co.uk/