Safe Deposit Box Demand

The concept of the humble a safe deposit box has been around for over 150 years and from the very beginning, the service was provided by the banks and private security companies.

It was always seen by the banking sector as a service they provided to their most discerning clients. Indeed, its fair to say in the latter half of 20th century, the banking sector felt almost obligated to provide the service but it was never seen as a core product, instead a service they were expected to provide to their high net worth clients. In the aftermath of the global financial crash of 2008, as banks worked to redefine their business model, the unprecedented push to move the consumer to online banking platforms resulted in a dramatic reduction in bank branches across the world. One of the consequences of this new strategy was the decimation of locally provided safe deposit box services as bank branch after bank branch closed and clients were "invited" to remove the contents of their safe deposit box.

So imagine if you will, the dramatic reduction in capacity from an industry sector who never saw the product as core in the first place, rather a service they felt obligated to provide to the top 5% of their client base, then of course the perception is created that demand for the service is in decline.

Nothing could be further from the truth.

The consumer was never the driver of this strategy, instead, the consumer was the victim as bank branch after bank branch closed and /or banks disengaged from the service completely.

In some countries such as Ireland for example, every single bank in the country withdrew from providing the service over a matter of a few short years. To be fair, banks have also faced increasing pressure from regulatory bodies to significantly enhance their anti money laundering provisions and in a transactional business such as the banking sector, the storage and management of stored items on behalf of clients engaged in routine transactional business with the very same bank gave rise to ever increasing compliance burden.

As a consequence, less and less interest / investment in bank safe deposit box facilities gave rise to an ever increasing gap as demand far outstripped capacity. Go to any bank today as an "ordinary" client and explore the banks capacity to provide safe deposit box services. There are always exceptions but by and large, you will come to realize that the limited service is available and only to those discerning clients who meet a particular criteria and qualify to be placed on the banks waiting list.

As a consumer, you will be the first to appreciate that in the 21st century, its not logical to find that if you want to rent a small metal box, you must first have hundreds of thousands on deposit and if so, you win the right to be placed on waiting list that in some cases can be up to three years.... to rent a box !!

How can it be that a service so basic, (renting a small box), requires you to turn yourself inside out and then wait for a few years for a "Vacancy" to arise. Can't you see how that is simply illogical and yet we recently visited a safe deposit box center in Asia where the criteria required was to have 1 million USD on deposit and if you met that criteria, you could be placed on the waiting list !!

The ILLUSION of demand is fueled by this perception that the only people who need a secure offsite storage service are those ultra high net worth individuals dripping in gold and diamonds. Nothing could be further from the truth.

Likewise the movies create this perception of safe deposit box vaults filled with gold and boxes containing false passports, multiple different currencies. Boxes stashed with stolen cash or overflowing with the proceeds of some nefarious activity.</>

Sorry to break this illusion but nothing could be further from the truth. When you work in the industry you get to appreciate just how critical the service is to clients who use the facility every single day. Everyone has something of value, something they need to keep safe. Covid 19 has reminded people all over the world of the transient nature of our journey through life. Bad things happen to good people, we need to take reasonable precautions, We need to protect those we love and provide ourselves and our families with peace of mind. We need to protect our assets, ensure safe keeping for those things that people have worked their whole life to acquire. For sure there are people who store Gold and Diamonds, precious metals but the vast majority of safe deposit box clients are ordinary people who have acquired items of value (Financial, sentimental, academic) and they have a growing sense of the need to take reasonable precautions to protect these items.

Its that simple. Clients who don't have 1 million USD to deposit have title deeds to the family farm, they have a watch given to them by their father, they have some jewelry collected in their family over generations. Clients who are travelling and don't want to leave their documents, their spare cash, their cheque book, their car keys hanging around and prefer to take the simple precaution of renting a safe deposit box.

Clients who have lost a dear one and can't bear the thoughts of anything happening to the precious items they keep that once belonged to their loved one, photos, a watch, a certificate. That is the demand fueling the growth of the safe deposit box market worldwide. Tens of thousands of ordinary people with ordinary items of value and a realization that if we have the option to secure these items offsite, in an environment where we feel safe and we can access these items anytime we want 24/7 with absolute security and privacy.

That is why in the midst of a pandemic, companies like MySafe are opening our 6th MySafe safe deposit box centre , a fully automated 21st century safe deposit box center at the Dubai Airport freezone (DAFZA), just 7 minutes by taxi from DXB Terminal 3. We invest and work hard to meet the demand of the consumer, ordinary / extraordinary people who see the benefit in taking reasonable precautions and want to rent a simple box in a safe environment so they have be sure their items of personal value are safe.