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Is your lender trying to supersize you?

July 11, 2011

Next time you go into your mortgage or bank branch to conduct some day-to-day business, beware the smiling customer service operative behind the counter. According to a new survey, they might be out to sell you a shiny new financial product you don’t want or need but that they’ll have you thinking you just can’t live without!

The Financial Sector Union (FSU) survey of 3200 bank, financial services and insurance employees revealed that more than half have steered a customer towards a financial product they didn’t need in order to meet their sales targets. The end result is that many Australians have been saddled with extra financial products due to high-pressure performance and sales targets.

In response to the data, SFU national secretary Leon Carter said employees were also motivated by fact that finance sector base wage rates are not high, making bonuses and performance pay even more attractive. The survey showed that 88 percent of employees said one quarter of their income is generated by sales.

Carter said these sorts of monetary incentives should have been phased out during the GFC and that the practice of multi-nationals, who post multi-billion dollar profits each year, using FSU members as conduits with which to fleece the public must be discontinued. Carter also said this type of sales tactic in regard to financial products is completely at odds with the notion of responsible lending.

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