The legacy banks in Switzerland

Transaction costs

I have a separate bank account for my tandem flying hobby at the local bank where I live. I didn’t want a plastic card for it, and setting up online banking turned out to be too complicated. So I pay a CHF 3.00 fee for every withdrawal at the counter. That is, if I go to the branch at my home town.
But last week I wanted to withdraw some money near where I work, less than 30km away, at a branch of the same bank. The teller told me that he would have to make a phone call to the other branch, and that the transaction would cost CHF 10.00
That was too much for me. Considering that a bitcoin transaction to Australia (16’000 km) costs CHF 0.02, the transaction cost of the retail bank per km is more than 250’000 times as expensive as that of BitCoin.

Communication

In Switzerland we usually don’t tell each other how much we earn, or how much we have on our bank account. Swiss Banks even had a reputation of secrecy up until recently. Naturally when you communicate with your bank, you expect this to be confidential. So I asked my bank representative for his public key some years ago, so that we could exchange encrypted emails. His answer was that I would have to use the messaging in the online banking platform in order to enjoy encrypted communication. I strongly dislike to have to log into different web platforms in order to communicate with different people. Some banks even communicate with their customers through centralized unencrypted social media, thus voluntarily introducing a man in the middle. I just had to accept what they offered for the time being. Hence I used this messaging system to cancel my credit card last year. He asked me if I wanted to cancel right away, or just not renew it when it ran out in a couple of months. I opted for the later. But then it was renewed nonetheless. So I asked what went wrong, and to please fix it. The answer was, that I didn’t specify when to cancel. Of course I did! Whether the message disappeared from the system because of some glitch, or was deleted intentionally to cover up incompetency doesn’t really matter. Fact is, the communication channel failed completely. Accountability is an important part of communication. This incident cost a lot of trust that I had in my bank.

Stranded funds

But the story with the cancelled credit card didn’t end there. Because it was not cancelled in time. Some company where I used a service, renewed without my consent. Thus they charged the card that should have been terminated by that time. So I had to send a printed form for the chargeback to the card operator. It took some time, but the money came back to my card account. And for another half a year, I receive a monthly letter stating the balance would be reimbursed next month. I misinterpreted this that it would be automatically sent back to my bank account. But it won’t. I have to send them another signed letter by snail mail to perform the obvious. As if it was 1995, and the electronic signature on my email was not 1’000 more secure than the ink on the paper.
Maybe I’m just spoiled with how well everything works with BitCoin. But the legacy banks really could do a better job.
Companies that deal with BitCoin usually:

  • Have competent and responsive customer care
  • Offer real two factor login with hardware tokens
  • Encrypt and sign the eMails with OpenPGP
  • Execute transactions instantly, not only once per work day
  • Have reasonable fees, even if the volume is still ramping up
  • Care about the usability of their platforms

And where they have limitations, they are usually imposed by the legacy financial institutions.