Everyone wants to save money. Times are hard thanks to austerity, and although there is light at the end of the proverbial monetary tunnel, we’re not quite there yet. Which is why even those who hold the money need to keep a tight rein on it – the banks are no better off, ironically, than the rest of it.
And this is why the big Dutch bank ING, is planning a massive change in its personnel which will save it around €900 million ($1 billion) every single year. So what could it possibly be? What could be changing so drastically that so much money can be saved?
Cutting Employee Costs
Well, in most businesses, the thing that costs the most is personnel. And some firms save money in this department by streamlining the roles that they have so that fewer employees are needed. Then, when new team members are required, they can be hired at a much lower rate. Great idea (for business owners and bankers, not so much for those in the roles). But ING is going one step further – yes, it is letting people go, with redundancies of 5,800 personnel, and it is changing further jobs (1,200 of them). However, on top of that, it is investing a whopping €800 million over five years in order to bring in machines to take over the jobs that are going. Most of the job losses will come from the full-time risk management and HR departments, as well as IT – these areas will be centralised instead.
It’s not all bad, though. ING has set aside over €1 billion for redundancy payouts.
A Terrifying Future
The machines will be put in place in order to standardize the data processes – and pretty much everything else in the end – and create ‘one digital banking platform’ where no humans will be needed in the mix at all.
Of course, the unions are not happy about any of this. In 2008, the Dutch government bailed out ING to the tune of €10 billion after the big economic crash. And now the loyal staff and customers are going to be offered something akin to Netflix rather than the traditional banking model.
It’s the future! Although it’s a fairly terrifying one.
Because if machines are doing all of our work, we’re not going to need banks, are we? We’re not going to have any money to put in them…
Still, ING seems to think that this investment is worth every penny, and it certainly will save the lending firm many millions – if not billions.