Let's Waste Another Billion on SCV...

If this is the future of regulation, then God help us.

I can't think of a bigger waste of money (at least, not at the moment, but I'm sure something will turn up) than spending £1 billion plus (let's not kid ourselves, this would cost a whole lot more) on getting all banks to devise and build (and maintain) a system that provided a single customer view of the whole relationship across each organisation so that the FSCS can make payouts a few days quicker.  What makes this all the more laughable is that it's designed to simplify a once-in-a-blue-moon event.  Bank failures in this country are very few and far between and, let's face it, what we have learned in the current mess is that the authorities won't allow one of the major banks (where most of this money and effort would be spent to put this in place) to go bust anyway.  It's even debatable whether they'd allow a smaller bank to go under as well, after the NR and B&B fiascos - so why do this at all?

Even if this were followed through, enough unsuccessful attempts have been made to create a genuine enterprise-wide SCV within our banks to show just how difficult this is, if not impossible or not cost-effective.  Just think of all the other wealth-creating things our banks could do with £1 billion plus.

Of course, there are many positive reasons for wanting a proper SCV but despite that, nobody has come up with one that works fully and provides value.  In every case I've seen, the eye-watering cost of designing, building and, just as importantly, maintaining such a view has so far proved to be far too much to justify the expense in terms of the revenue generated.

The only party that understands the full up-to-date relationship with an organisation is the customer anyway, and that is likely to remain the case.  In any event, if all the knowledge about a relationship is concentrated in one place, can you imagine how valuable that information is to a fraudster and therefore what damage they could really do to a person if they got their hands on it?  Coupled wuth this story https://www.finextra.com/fullstory.asp?id=19496, you probably get the picture...

The best way forward to manage these infrequent events is to have a very good operational process in place that sets out what claimants need to do in terms of a) making a claim and b) providing evidence to substantiate their claim.  A slick process will go a long way to easing the infrequent pain inflicted by bank failures such as this, rather than saddle a struggling industry with obscene development and operational costs.