A few months ago, after decades of being a happy customer, I decided that my main savings account could no longer be with POSB.
It was a decision that was both sad and painful.
Sad because my trusty POSB savings account was opened when I was all of seven years old. The POSB van came to my school and I was among hundreds of students who sat in the assembly hall patiently waiting our turn to save our first dollar.
Painful because this sort of decision is not at all easy to pull off. My salary got credited into my POSB account every month, and all sorts of Giro payments - from my car loan instalments to my utility bills - were wired out of that same account.
The inconvenience factor is therefore high when you are switching what is known in consumer banking jargon as your 'salary account' from one bank to another.
You have to inform your employer and the change can take as long as two months to complete. You then have to write to each organisation you are making Giro payments to, telling them about the change.
Different organisations make the change at different speeds, so in the transitory weeks, while all this is happening, you have to monitor both your old and new savings accounts closely to make sure that
Giro payments don't fail.
Just thinking about it is exhausting, so it is no wonder why few people bother to make the change.
It is, after all, just a savings account, many people reason.
Money goes in and money comes out. The interest rate is more or less the same everywhere, so why bother with the inconvenience of switching banks?
The answer is that, in this day and age, the so-called standard savings account product is no longer standard across banks.
With interest rates close to zero (they are about 0.25 per cent now), and small but significant service charges routinely levied for cheques and balances falling below a certain threshold amount, I would argue that most customers are in effect paying for a service when they maintain a salary account with a bank.
And although this often goes unnoticed, it is becoming clear that some banks are willing to spend more on their customers, and therefore offer superior service.
For me, the turning point was when the banking regulators in Singapore decided to make 'two-factor authentication' (2FA) for Internet banking compulsory last year.
In simple terms, this means that it is no longer enough for Internet banking users to have a user name and a PIN.
For added security, the bank must now provide them, at every log-in, a second PIN that is randomly generated. How to provide that second PIN is entirely up to the bank.
Now, many banks in Singapore send that second PIN by SMS to their customers' mobile phones each time they log in.
But this is very expensive for DBS Bank and POSB because they have a huge customer base and each SMS costs money to send. DBS also claims there are security issues, so it has decided that it would instead issue a small plastic device - known as a 'hard token' - to each customer that automatically generates the second PIN.
Each customer can have only one token, so it follows that you have to carry it with you if you want to log in from say, two locations - home and office.
The token is bulky and looks awful next to that Gucci or Tiffany key ring, so understandably, many do not carry it around. The result is that the client can do Internet banking from only one location (that is, where he puts his token).
For me, it was a deal-breaker. I use Internet banking all the time - at home, in the office and when I am overseas - and I could not stomach having to carry an additional weight in my pockets in the name of helping DBS and POSB save costs.
The bank I switched to - OCBC Bank - sends you the second PIN in as many as three ways. You can opt to have a hard token or receive it by SMS. But the bank also has a 'soft token' program that sits in your phone and generates the PIN.
But I did not just switch to OCBC because of its 2FA solution. As far as my own needs go, it is currently providing one of the best value propositions around.
For example, I often do not have time to visit a bank branch on weekdays. So I appreciate that OCBC has 10 branches open on Sundays.
It is probably the only bank to put serious money and resources into mobile banking, and its special mobile banking program that sits in your phone has already won awards for innovation.
OCBC has also tied up with FairPrice to put ATMs and banking products in supermarkets. And its aggressive push into kids banking (called Mighty Savers) means that it is making more sense to keep OCBC the bank of choice for the entire family.
Among the foreign banks, Citibank has also made great strides.
The key problem with opening a salary account with a foreign bank used to be that they did not have many ATMs and branches, and this could be inconvenient when you need to withdraw cash.
But the five foreign banks have now pooled their ATMs to provide wider coverage, especially in areas that matter like Orchard Road.
And Citibank has taken advantage of freedoms accorded under the United States-Singapore Free Trade Agreement to open more branches. Its tie-up with SMRT means that there is now a Citibank branch or ATM at every SMRT train station.
The savings account may be the most basic and common banking product there is, but that does not mean that the customer should have to live with anything less than the sort of customised service that he needs.
It is not so much about whether OCBC or Citibank is providing the best service around by any measure, because different people will have different needs.
Some are content with the bank that has the branch closest to their home or office, for example, while others may go for technology.
All things said, many choose POSB because it is still the lowest-cost option around.
The mistake that can be made with savings accounts is to assume that they are built the same way, when some shopping around could yield the product that best suits you.
The title of this column suggests that a small change could leave you better off. In my case, that change was well worth it.
This article was first published in The Straits Times on April 13, 2008.
