Another Bancolombia App Outage Highlights the Need for More Competition in Colombia’s Banking System
Bancolombia is Colombia’s biggest bank on most metrics and, remarkably, surveys often measure it as one of the most — if not the most — popular brands.
Photo: Bancolombia headquarters in Medellín, Colombia. (Credit: Juan Camilo Trujillo)
Personally, as a shareholder and ex-employee, I question whether a bank should ever be popular. And given its ongoing system failures, which date back a decade, I wonder how people even come to that conclusion.
The Bancolombia app went down for around 24 hours this weekend — meaning that literally millions of people were unable carry out their usual banking services. It is incredibly unacceptable, and the industry regulator Superfinanciera Colombia needs to be holding a top-to-bottom investigation and applying the applicable fines.
Colombia is effectively a country of four major banks.
This is another example of why borders need to be breached. The need for open finance has never been higher.
Brazilian neo-bank Nubank has made a positive impact, but Colombia needs 20 more — and not fintech startups but plug-and-play banks that will drive fees down and force the incumbent banks to up their game.
This is a country where banks still charge you for the privilege of looking after your money. Dickensian some would say.
While Bancolombia said, “Don’t worry you can still get your money from an ATM” during the outage, that flies in the face of its drive towards online transactions and sets aside the fact that it is a long weekend when many are away from the cities.
No doubt, industry trade group Asobancaria will see this as normal. But it is not. It’s a shambles.
Personally, it hasn’t affected me unduly. But there are many, many clients much closer to the hand-to-mouth scenario who will be troubled by this — not to mention all the businesses that also are reliant.