As the start of school approaches, Swedbank has prepared an unpleasant gift for schoolchildren, their parents and all other customers - almost one million people in Latvia. On September 1, the prices of banking services will be increased.
Customers have already been warned of the upcoming cost increases in advance, and the main justification for the changes is to improve the customer experience: "We have introduced a number of innovations to make our customer experience one of the most modern in Europe (...) Some service prices have been adjusted to the current market situation so that we can continue to pay more attention to improving technology." To fund this improved experience, for example, account holders who reach the age of 65 will no longer benefit from the current 50% discount on Swedbank's monthly payment card fee. The monthly fee for a regular payment card will be increased from 85 cents to €1.70. The same fee will also apply to the credit card. The price is increased for payments made in branch and by phone. These services used to cost €3, but will now cost €5. It should be made clear that people who do not like using computers or are not good at it are more likely to communicate with service providers in person or by telephone. Also older people. So the bank is now inviting them to reconsider their habits and use services remotely via internet banking or a mobile app. The full list of changes to Swedbank's price list can be found HERE.
Neatkarīgā asked the bank for further clarification on the planned increase in prices for services from September 1. What technologies are planned to be upgraded and how much will the bank spend on this. Here is the reply:
"In order to improve our customers' experience and ensure modern service delivery, which is our priority as a foundation for good customer service, we are continuously investing in improving technology - there are projects that have been started, are ongoing and new ones are being introduced. Examples of technology improvements for customer convenience include the already introduced availability of remote video consultations for both retail and business customers, as well as the possibility for parents to remotely open a bank account for their child (6-15 years old), which is particularly important when preparing for the start of school." No answer was given on the actual cost of the planned improvements.
Inflation is currently very high in Latvia. Absolutely everything is becoming more expensive. Food prices were up 22.5% year-on-year in June, transport-related goods and services 32%, fuel 60%, electricity 63% and gas 106% higher in June than a year ago. According to the Ministry of Finance, annual consumer price inflation already reached 19.3% in June, but the big peak in inflation is still to come in the autumn, with the start of the heating season. Against this backdrop, it is not surprising that the prices of financial services are being increased. At the same time, the wealth of the banks themselves is increasing. Data released by the Financial and Capital Market Commission show that the Latvian banking sector made a profit of €68 million in the first quarter of this year, almost 30% more than in the same period of 2021. And Swedbank's quarterly report shows a significant increase in profits compared to 2021. In the first three months of this year, Swedbank earned €23 million, compared to €16 million in the same period last year.
Every customer has contributed to the bank's prosperity and will contribute even more from September 1. Including for the bank to improve the customer experience and continue to focus on improving technology.
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