UAE financial firms upset by ban on cold calls but many will adapt to survive

UAE financial firms have responded with indignation to a complete ban on unsolicited calls by the central bank, but will now have to learn to market their services in more conventional ways like the sector manages to do in other advanced countries.

It has long been annoying to expatriates and nationals alike that the practice of so-called tele-marketing in the UAE includes a lot of cold calling. This means obtaining lists from directories or other sources and telephoning people without an introduction to offer a loan, or entice people to a meeting to discuss their personal finances with a complete stranger.

Cold calls continue

Banks like HSBC do not allow such cold calls but most of the other international banks and many of the local banks do. A lady from Mashreqbank phoned the ArabianMoney office yesterday offering a mortgage facility only to hear about the new rules that made her call illegal.

The UAE Central Bank is to be congratulated on its decision to move the country from the Third World to the First World in this aspect of good banking practice. Those firms that suffer a real loss of business will be the telephone cowboys and not the properly organized financial institutions, although they will now have to rethink their approach to marketing.

Instead of bothering people with unsolicited cold calls they might well find another approach works much better, particularly if low-end competition is eliminated by this reform and bank staffing levels can be down-sized.

Advertisements actually work

Tele-marketing does not have to involve cold calls. It can be done to follow up enquiries in response to advertising or sponsorships. There is nothing now illegal about that.

For example, if you look to buy a new television in the UAE you might see an advert first in a newspaper or on a website. You don’t need to wait for Samsung to give you a call one day out-of-the-blue to enquire whether you might like a new television.

Using telemarketing in this way to sell an new credit card or pension is just as ludicrous when you think about it, and all those tele-sales staff have to be paid. Do they really provide a good return on this marketing spend? Might traditional advertising and sponsorships not work better, especially in targeted media?

Yes only the bigger and hopefully properly regulated financial companies can do this but that also works to the advantage of the consumer in the long-run. All financial investment companies (listed here), investment consultancies (listed here) as well as banks are covered by the new ruling.