Paper presented at the Seventh Payment Systems International Conference, September 24-26, 1981, Camel Back Inn, Scottsdale, Arizona.




By Hans L Zetterberg, Sifo, Stockholm



This paper has three parts: the first deals with consumerism and banking, the second with personal and automated banking services. These two parts have a historical perspective. The third part takes a slice through the population of contemporary banking customers and tries to define their concerns about banks.




The modern consumerism movement came as an aftermath of the tremendous growth in mass marketing at mid-century. Production line manufacturing, credit services, and mass marketing quickly and efficiently filled the pent-up needs accumulated in the depression of the 30s and the world war of the 40s. Some people thought that the new mass markets were too overwhelming to the consumer. A distrust of the market grew and cries for consumer protection became louder in the late 1950s and 1960s. Ralph Nader’s book Unsafe at any Speed showed the main features of consumerism: the belief that the consumer was weak and easily victimized in the new market by shoddy, dangerous products for which he paid unfair prices boasted by excessive financing charges. The emergence of Nader also set a new political style: we encountered young, bright men and women fighting with legal briefs, presenting research reports with non-establishment knowledge and with powerful allies in the media: smart use of publicity became a hallmark of the new movement. By contrast, the marketers’ use of media - advertising - became subject to special scrutiny by the consumerists. The burden of proof shifted more toward business. The old notion of “buyers beware,” became “retailers beware,” “newspapers/broadcasters beware”. In all Western countries we obtained consumer legislation and consumer protection agencies. All based on the twin assumption that the market could not be trusted but needed correction and government intervention, and that the consumer was weak and could not fend for himself.

The banks were also affected by this movement. The most well-known bank legislation in the consumerist vein is Senator Hubert Humphrey’s truth-in-lending bill. In one form or another, this legislation has been copied in most countries in the Western world.

Banks have a longer history of government regulation than most other businesses and they were better able than most to take consumerism in stride. In the interest of protecting the depositors banks have long before consumerism been required to borrow long and lend short and they have been required to keep a fair share of their assets in supposedly safe forms, meaning government securities. (The latter requirement is usually much abused by deficit-ridden governments!) The great innovation in banking in our time, the Euro-market, created by the London merchant banks, is exciting precisely because it circumvents national restrictions: it is a mere genuine market. It is an interesting and telling circumstance that this market emerged at the same time as national regulations were growing in number and stringency.

Looking back at the heydays of consumerism one is struck by the pre­valence of the belief that a market failure or weakness required a government response. And when government intervention did not solve the problem, the only call heard in public opinion was for more government intervention. The market was rarely given a chance to correct its own ex­cesses, which markets supposedly are particularly good at doing. The situation has been compared with the Roman emperor’s judging of the finale in a chorus contest. The emperor listened to one chorus, then gave the prize to the other and went home. The market chorus does not sing perfectly but that does not mean that the government chorus sings better. However, such was the public beliefs in the 60s and early 70s.

Now we have a very different situation in public opinion. The 1960s and 1970s said that all evil comes from the market forces, the l980s say that all evil comes from government intervention. The market economy today gains many champions among intellectuals, and government loses many. Also, among the general public the trend is very clear: Polls in all major Western countries tell the same story: less confidence in solutions, by less call for solutions from resources obtained by taxation, more call for solutions that obtain resources from the market. Governments are no longer eager to go the errands of the consumerists: you have to present a very clear cost-benefit analysis to obtain consumerist legislation.

This is indeed a remarkable shift in public opinion, the full impact of which we have not yet seen. It is very important that this new trend not be misunderstood by business: it is in no way a license to act irresponsibly toward the public, but it is a license to get the govern­ment off your back. It would be a big mistake to think that now we can tell lies in advertising, hide real interest costs and sell shoddy products or no-good services. Consumerist ideals of the 60s and 70s have been taken to heart by the public, they are “internalized”. What we may dispense with is not good behavior, but the incredible web of consumerist regulations, some of which are contradictory and some of which are obsolete products of bygone, unrealistic and occasionally invalid public concerns.

Recent studies of the public mood in these matters indicate actually an attitude to keep disclosure requirements about content declarations, interest rates, sources of advertising claims etc. A typical interview with the public goes somewhat like this -


-How often do you read the small print?

-Hardly ever.

-Do you think we should stop requiring such disclosures?

-No, not at all.

-Why, you said you hardly ever read it?

Oh, it is not for me. It should be there to keep the money lenders honest. -


Thus the disclosure adds primarily to a feeling of confidence among the public, not to its level of information.




In the 1920s a husband-wife team of sociologists, Robert and Helen Lynd, studied a typical American small town, Muncie, Indiana. They called their report Middletown and it became very well known and somewhat of a bestseller. Robert Lynd’s father had been a banker, and we get a great deal of knowledge of banking in Middletown. Middletown had, of course, a banking family: this family owned the local bank, a manufacturing plant and some real estate. The name of the family was a household word in Middletown. The confidence in the bank was in large measure synonymous with confidence in this family. You deposited your savings in their impressive banking hall downtown, you looked up the hill to the rich banker’s house and to the valley toward his factory, and you felt confi­dent that your money was safe and doing good for the community. Banking was local: you dealt with the people you knew, with neighbors or with neighbor’s neighbors. The teller used to nod at you in recognition when you came to the end of the line before his window, you used to smile admiringly at his agility of counting bills. The transaction was solemn in that you signed your name and you got the tellers’ initials in your pass book. And everything was sealed with the rituals of greetings and parting, Should the need ever arise for an exceptional credit for expansion beyond the home town, the banker would turn toward a banker’s bank in Chicago, who in turn could draw upon banks in Boston, Philadelphia or New York. The public viewed the bank with a certain awe and mystic. In reality a bank, then as now, might have been a business competing for deposits and scrambling to sell cre4its. But it did not seem that way to the men and women of Middletown. The deposit was a safekeeping to thwart thieves and the loan was a great favor. (Several later interview studies in other countries have also shown that the public has been rather blissfully unaware of the fact that banks must compete for deposits and sell loans to survive and make a profit!) No doubt the banker in Middletown in the 1920s commanded confidence, power and prestige In many ways Middletown was an attractive world, the kind of world that Ronald Reagan grew up with and which his election campaign a year ago brought back with nostalgia.

Banking today has lost much of its neighborly touch. Nowadays you know your customer, no longer as a face but as a computer printout or a display on a video console. Strangers enter your bank, flash a check cashing card (or other approved ID) and walk away with their wallets full of cash. Or, they press buttons at cash dispensaries or automatic tellers. The routine bank transaction is deprived of human content.

Many cases of automation of services have been studied by social scientists: from replacements of guides at art museums with receivers for localized broadcasts that fade away as you walk away from a painting to the selling of gasoline on credit cards at unmanned stations. Most such technologies have been accepted by the public. A few have failed to get long term acceptance: Horn and Hardart automated restaurants is an example known to old New Yorkers. A minimum of human presence seems to help: it is to most people more satisfying to go to a Laundromat with an attendant that to one without. When a visit to a bank for routine purposes becomes like entering an elevator and pushing buttons of instructions for what you want - you are not introducing anything world shaking: many businesses are ahead of banking in automated service.

There is, however, a non-visible cost in automating services. Your automatic teller cannot count on any loyalty or consideration. It is fair game to cheat it, it gives few pangs of conscience to vandalize it  at least in comparison with the human being it once replaced.

You may have heard Kristine Shannon’s phrase “High tech, high touch”. By this is meant that the use of high technology must be matched by use of human touch. We spend many hours cramped in high—technology jets to fly to Phoenix to meet face-to-face. We need to meet, look one another in the eye, try out each others’ nicknames from the nametags to deal with the most sophisticated payment networks the world has ever seen. It would be total horror if we were only computer passwords to one another. Hi tech requires high touch.

Your local customers at your newly automated branch office have the same need to match high tech with high touch. What have you done to meet his or her needs? The sweetness of life for the banker in Middletown was enhanced by his command of community confidence, prestige and power, and I would be the last to deprive bankers of today of these attributes. Prestige and power tend to isolate people. And isolation does not bring in business, nor does it necessarily add to the public’s confidence. If you have the choice, promote someone who is projecting confidence, and forget the prestige and the power. Most of all I think we need bankers in leadership positions who can communicate beyond specialties. The burden of explaining the by-products of political decisions in the form of inflation and high interest rates falls increasingly on the bankers who have more daily contact with the public than the politicians. More important, the demands of communication grow exponentially more complex, the more technical the systems we operate.

One of the world’s greatest banking centers, Zürich, has in the past couple of years been sending signals to the world that have been hard to interpret. This very citadel of orderliness, well—being and knowledge has been rocked by youth riots. It began innocently with flowers painted on the Globus department store to make this commercial property more attractive in the eyes of the young. It started with reasonable demands for a city youth centre. The youth centre is now a reality, but riots continue. The flowers have been replaced by leftist slogans and odd demands such that Greenland be liberated from its ice. One interpretation is that the good burghers of Zürich are developing their commercial, technical and political systems and apparatus to such perfection that they literally loose touch with the young generation.

You may say that this is none of our business. However, there are technically skilled and bright people among the rioters, and they undoubtedly have friends who are programmers. It would be a great symbolic value to them to occupy or gain access to a bank computer and play havoc with the payment systems. In the student riots of the 1960s the university computer was in several instances a prime target.

The systems we build regardless of the tolerances calculated by the hardware manufacturers and systems engineers can never be stronger than the social fabric of our society. By making ourselves dependent on complex sophisticated systems we must also develop a commitment to stable societies. This is the message of Zürich.




In the final part of my presentation I will divide the bank customers into eight major types following a scheme found in a forthcoming report in the series Anticipating Social Change in Europe (ACE). We will then be able to better pinpoint the concerns about banks as they are expressed among different customers. The eight types will be given these names: Subsistence-Minded, Security-Minded, Group-Faithful, Status-Seekers, Movers, Self-Faithful, Experience-Seekers and Reformers.

Says psychologist Erich Fromm: “The shift from a psychology of scarcity to that of abundance is one of the most important steps in human development. A psychology of scarcity produces anxiety, envy, egoism (to be seen most drastically in peasant cultures all over the world). A psychology of abundance produces initiative, faith in life, solidarity”.

The welfare states of Europe are already a generation or more into the psychology of abundance, not only for the privileged but for the ordinary citizen. When an industrial economy produces an abundance of wealth and a welfare sate distributes the wealth somewhat equitably throughout society, the stage is set for another major shift in values. Survival is no longer the problem for the citizen as the responsibility of sustenance is shifted toward government. On a massive scale the individuals are now free to pursue personal needs beyond sustenance, beyond survival and basic security. These new values can be seen in the production and distribution of wealth  and in reproduction i.e. the bringing up of new generations of workers and the nurturance, physical and intellectual, of the existing work force.

In short, we find in an advanced society today three systems of values that always mingle and sometimes conflict with one another:

(A)       The values of sustenance embraced by Subsistence-Minded and Security-Minded have their roots in the agrarian society. The key words are survival and security, that is, these values are built up around one’s daily bread and the need for well-filled barns. The fruits of labor belong to the worker. According to the values of sustenance he provides himself and his family with the basics of existence. Very little is provided for the market.

(B)       The values of production embraced by the Group-Faithful, Status-Seekers and Movers have their roots in the industrial society. The key words are solidarity among workers on the one hand and efficiency on the other: the values are built up around involvement with the processes of production and the generation of prosperity. The fruits of labor (which are considerable) are marketed and the proceeds are shared by the workers and the representatives of capital. According to the values of production one works for economic growth and for a certain standard of living.

Within the broad realm of values of production we may distinguish the entrepreneurial vision in which creation of new wealth is central and the equalitarian vision in which the equitable distribution of wealth is central. The former is embraced by the right and the latter by the traditional felt in the industrial states.

(C)       The values of reproduction embraced by the Self-Faithful, Experience-Seekers and Reformers have their roots in the welfare state. The key words are empathy and personal growth: the values are built up around one’s own inner development and the inner development of others, and the creation of quality of life. The fruits of work (besides a salary and capital accretion) are the work itself and what it offers in terms of meaning, comradeship, and potential for personal growth. According to the values of reproduction one works for self-development and quality of life.

It is obviously true that individuals are not fashioned from whole cloth. They do not embrace all the values and attitudes of one specific value orientation but are rather tapestries in which one or two weaves emerge predominant.

Subsistence-Minded are hand-to-mouth penny pinchers. They just manage to get by in a society that regards them often as on the fringe. They usually view the world around them as/threatening and hostile, and they are themselves suspicious of others. They have little hope for the future. Some Subsistence-Minded are social misfits who attain no more than meager lodgings to tide them through the night, bread for the day and frequently a bottle for the day as well. However, most Subsistence-Minded are not down and out; many are older people who live not very differently from their ancestors in an agricultural setting.

As consumers the Subsistence-Minded are mostly concerned with bare necessities. Price is naturally paramount – they want the cheapest of everything.

Bank accounts are not as common among the Subsistence-Minded as among other groups. They use cash also for their savings – in France, of course, they may hide a gold coin or two. The spreading use of direct deposits of pensions and welfare checks gives them bank accounts and brings more of them into banks than ever before. Are you going to be more than a check-cashing agency for them?

The Security-Minded clearly differ from the Subsistence-Minded in their more active and safer way of living. Security is their lodestar. They live carefully and guard the security they have managed to achieve.

The mature welfare state is their ideal society. They are happy with the social security network. As voters they would never conceive of “voting away security”. (“Don’t vote security away” has been the central slogan of the Swedish Social Democrats since the 50s.)

The Security-Minded are dutiful and loyal. “You must” and “you must not” are important words in their daily vocabulary. They are somewhat apprehensive about experimenting, and as consumers they are first and foremost cautious. They look at the price, but are also concerned about guarantees. “Consumer safety” is an idea that appeals to them. They do not like to get into debt. They are conscientious savers. Along with the next group, the Group-Faithful, they are the savings bank crowd. They have taken a severe beating from inflation, and recent polls show that they react to this by embracing more authoritarian views. If we had a return of the Roman emperor who tried to beat inflation by introducing the death penalty for overcharging, today’s Security-Minded would support him.

Politicians tend to think that all citizens are predominantly Security-Minded. This is nonsense. Thrift institutions in the US have found the hard way that guarantees by Federal Deposit Insurance are far from enough to keep depositors when the money funds are offering higher yields.

The Group-Faithful want most of all to blend inconspicuously into their social situations and not deviate from the norms of the group they identify with. They are reluctant to move from their home town, and they want to keep their jobs all their lives, if possible. They become the pillars within the organizations they belong to. They constitute the infantry of the buildings and loan societies. They want to own their homes and they are family-oriented. A good mortgage is central to their life planning. Divorce hits them hard even if love has left the relationship.

The Group-Faithful would never stray from the party line at elections, even if they disapproved of some party ‘policies. As consumers they prefer familiar brands of standard products.

With this group as a base the Canadian coop banks have been successful in expanding into other target groups.

The Status-Seekers also search for an identity through others, but not among their peers: they want to identify with some admired group or idol.

Status-Seekers are acutely aware of social and financial position; they are fashion-conscious and rather materialistic. They are also very competitive. They appear to be somewhat meretricious and usually strive to imitate others rather than be themselves.

This is our first group in which loans are an absolutely natural part of living. Status-Seekers are acutely aware of inflation and try to beat it by quickly turning any unused funds or credit into capital goods before prices go up.

The Movers - a designation that is used here as in “movers and shakers” -are well attuned to the outside world. They are achievers who value fame and success. They are effective and driving force in whatever field they are active, but they are also driven by their own ambition. They constitute the target group of the commercial banks.

The Movers are self-confident and willing to take certain risks. They often assume leading positions, whether it be in business, in science, in trade unions, or in special interest organizations. They are interested in innovations in political and organizational spheres, but especially in those of a technical nature.

Movers give priority to productivity, efficiency, and economic growth. They constitute the bulwarks of free enterprise and industrial society, and they have a keen interest in the economic side of politics.

As consumers they are connoisseurs of quality and sometimes choose luxury items that testify to their success and accomplishment. At present most of them seem to plan for continued high inflation: they prudently keep them­selves in debt. Their capital is in constant search of inflation shelters: in the past decades it has mostly gone into real estate. Banks are good to them and they are good to banks.

The motto of the Self-Faithful is “I am I”. They are flamboyant and eager to experiment, but are true to their predilections as long as their enthusiasm for them lasts. They have nothing against drawing attention to themselves, and their clothes are often eye-catching. In the 1970s the Self-Faithful became so visible that the period was called the “me-decade”. In politics they are drawn to action groups rather than to parties. They seem to prefer to pursue one issue at a time and to do so with total commitment. They have a youngish profile.

The Experience Seekers aim to develop their inner selves through direct, immediate experiences, intense involvement in relationships with other people and/or with nature. They desire a rich inner life. Emotion and intuition are meaningful words for them. They do not look askance at astrology or Zen, and would be willing to give meditation a try: they are, in short, receptive to everything that can open new doors to the inner self. Experience Seekers therefore constitute a rather heterogeneous group.

Self-Faithful and Experience Seekers are not easily handled by ordinary bank personnel: something is missing in the usual personnel training here. Car loan officers will tell you that these people will buy a used car and then apply for a big loan to buy the best new car stereo on the market for it. They get fantastic inner experiences of music listening while driving a car that does not look much to the world. My guess would be that these groups have a high share of missed payments, but I have no hard statistics. They do seem more unconcerned than others about their credit rating. When they leave town they do not always bother to close their accounts, which may remain a dormant nuisance. They may nevertheless be good customers since they put a lot of effort into their life styles, which may require saving and borrowing.

The Reformers also strive for development of the inner life but they do not look for self-enrichment as an end in itself. They have more social consciousness, are more creative and critical than the Self-Faithful and Experience Seekers. To live with a sense of social responsibility is a part of their catechism. They are convinced of the merits of their values and want to change society to correspond with their values, not adjust themselves to society. Today, they are often advocates of simplicity and conservation.

They want to maintain or enhance the quality of their daily lives. They do not rush through the day, but rather happily pace themselves at 55 miles an hour in order to avoid stress.

As consumers Reformers are distrustful of advertising and critical of commercialism. In politics they emphasize global concerns, and they have actively supported many modern social and political causes: the anti-Vietnam movement, conservation, women’s lib, the peace movements. They are normally critical of banks.

To beat inflation they tend to turn to self-sufficiency. They will ask for mortgages to install solar heating, and drill a well, and similar schemes. They are convinced that the future belongs to them and their neighborhood projects.

These thumbnail sketches of different bank customers or target groups show a great diversity of expectations on the banks. Banks and their payment systems are not an end in themselves. In the final analysis, they must adjust to, serve and develop this diversity.

Thank you very much!