MSE News: Halifax and Bank of Scotland to slash bank charges

Can Guy or any bank workers of HBOS confirm that this is the Reward account being rolled out across all customers rather than just the initial ones that they announced last year?
Are you sure that they have got rid of the Unpaid fee altogether as well?

A poster on here has pinpointed 2 dates: October and December 6th(I think) as the date this is happening.

A&L current charges -

Overdraft Usage Fee
50p a day for no more than 10 days in each monthly charging period (up to £5).

Exceeding Overdraft Limit Fee
£5 a day for no more than 20 days in each monthly charging period

Payment Review Fee
£25 for each item

They are only changing the charging structure on the current accounts (with the exception of the Student Current Account). Below gives more detail on the effects of existing and historical accounts:-

Ultimate Reward Current Account will adopt the new fee structure, with the exception of the first £300 of an arranged overdraft remaining fee free. The U.R.C.A. will also benefit from the £5 if funded with £1000 in a calendar month. It will still cost £12.50 (potentially £7.50 with £5 Reward deducted).

Reward Current Account will remain exactly the same. However, I'd imagine the £1000 minimum funding will become mandatory for new customers and existing ones wishing to upgrade.

Relaunched Current Account will adopt the new charging structure. It will not carry the £5 Reward, and will operate as a standard free current account paying no credit interest.

High Interest Current Account will be re-designated to the relaunched Current Account. In my opinion a rather silly move seeing the H.I.C.A. has (or used to have) a £1000 minimum monthly funding to gain a higher rate of interest. So I fail to see (other than the obvious savings) why HBOS did not simply re-designate these customer's to the Reward Current Account.

Student Current Account will retain the existing charging structure.*

Easycash will retain the existing charging structure.**

Cardcash will retain the existing charging structure.***


Finally I would just like to clarify the Reward Current Account and future charging structure for all HBOS current accounts (except the Student Current Account). These are the main points:-

1) The accounts will no longer pay credit interest, or charge debit interest for the use of an arranged or unarranged overdraft.

2) If you fund £1000 or more to the U.R.C.A. (from 06/12/09) or Reward you will receive a £5 net payment the following statement month.

3) Any arranged overdraft up to £2500 will cost £1 per day to use. The first £300 arranged overdraft on an U.R.C.A. will remain fee free.

4) Any arranged overdraft above £2500 will cost £2 per day to use.

5) Any unarranged overdraft will cost £5 per day to use.

6) There will no longer be a charge for Unpaid Items.****

7) You have until close of business to clear any arranged or unarranged overdraft to avoid paying the daily fee. However a cut-off time has not been clarified but I would imagine 17:00 or perhaps 00:00 (seeing as fees are calculated on the last day of the statement month before the said month's statement is generated).

8) Fees are calculated at the end of the statement month. They are detailed on said month's statement, and fees debit at the end of the following statement month. For example: the first set of fees, for the month of December, will debit at the end of January (31/01/2010).

9) These changes will take effect on the 6th of December 2009.


* Paid and Unpaid Item Fee: £20 (no more than one of each per day); Unarranged Overdraft Fee: £28 (up to once per month). Arranged overdraft interest: 0% EAR (£0.01 to £3000); 7.2% EAR (> £3000). Unarranged overdraft interest: 24.2% EAR.
** Over 18's only. Unpaid Item Fee: £15 (up to three per day).
*** Over 18's only (no longer available to new customers). Paid and Unpaid Item Fee: £35 (no more than three of each per day); Unarranged Overdraft Fee: £28 (up to once per month).Cardcash unarranged overdraft interest: 29.8% EAR.
**** This is currently the case for the existing Reward Current Account, and will be applied to the U.R.C.A and relaunched Current Account from 06/12/09.

For more details on HBOS current charges and interest rates see below (this is useful for Student Current Account, Cardcash and Easycash holders):-

Halifax Website - Interest rates and account fees


Disclaimer: some of this information is speculative, and although I'd imagine it will come to fruition we will need to wait until we receive mailing from HBOS to confirm. Therefore this should not be regarded as Gospel truth (as with any post on MSE) until it comes from the horse's mouth i.e. Halifax Bank of Scotland.




Edits: 03/10/09 - noh - added interest rates and clarified EasyCash and Cardcash charges (updated ** and ***). 03/10/09 - natweststaffmember - provided details on when charges debit (added new section 8).

I would suggest that if anyone would like to add anything to this post, just comment on the particular point needing updated.

Update: I have created a permanent guide thread on this subject over in Budgeting & Bank Accounts. Click the below link to view:-
Halifax/ Bank of Scotland: a guide to account changes.

natweststaffmember wrote: »

Am I right in saying that business accounts are still not affected by these changes?(they are the ones that are being hit the hardest in these economic times).

Yes you're right. As far as I am aware this change will only effect retail banking, and more specifically current account holders.

jambosans wrote: »

They are only changing the charging structure on the current accounts (with the exception of the Student Current Account). Below gives more detail on the effects of existing and historical accounts:-

Ultimate Reward Current Account will adopt the new fee structure, with the exception of the first £300 of an arranged overdraft remaining fee free. The U.R.C.A. will also benefit from the £5 if funded with £1000 in a calendar month. It will still cost £12.50 (potentially £7.50 with £5 Reward deducted).

Reward Current Account will remain exactly the same. However, I'd imagine the £1000 minimum funding will become mandatory, otherwise the account will be downgraded to the relaunched Current Account.

Relaunched Current Account will adopt the new charging structure. It will not carry the £5 Reward, and will operate as a standard free current account paying no credit interest.

High Interest Current Account will be re-designated to the relaunched Current Account. In my opinion a rather silly move seeing the H.I.C.A. has (or used to have) a £1000 minimum monthly funding to gain a higher rate of interest. So I fail to see (other than the obvious savings) why HBOS did not simply re-designate these customer's to the Reward Current Account.

Student Current Account will retain the existing charging structure.*

Easycash will retain the existing charging structure.**

Cardcash will retain the existing charging structure.***

Finally I would just like to clarify the Reward Current Account and future charging structure for all HBOS current accounts (except the Student Current Account). These are the main points:-

1) The Accounts will no longer pay credit interest, or charge debit interest for the use of an arranged or un-arranged overdraft.

2) If you fund £1000 or more to the U.R.C.A. (from 06/12/09) or Reward you will receive a £5 net payment the following statement month.

3) Any arranged overdraft up to £2500 will cost £1 per day to use. The first £300 arranged overdraft on an U.R.C.A. will remain fee free.

4) Any arranged overdraft above £2500 will cost £2 per day to use.

5) Any unarranged overdraft will cost £5 per day to use.

6) There will no longer be a charge (under the new structure) for Unpaid Items.****

7) You have until close of business to clear any arranged or unarranged overdraft to avoid paying the daily fee. However a cut-off time has not be clarified but I would imagine 17:00 or perhaps 00:00 (seeing as fees are calculated on the last day of the calendar month before the said month's statement is generated).

8) These changes will take effect on the 6th of December 2009.


* Paid and Unpaid Item Fee: £20 (no more than once per day); Unarranged Overdraft Fee: £28 (up to once per month).
** Unpaid Item Fee: £15 (up to three per day) - over 18's only.
*** The Halifax Website states that fees to this type of account "does not apply". However I would imagine that both Cardcash and Easycard (although designed not to go overdrawn) are still subject to the £35 Paid Item Fee and £28 Unarranged Overdraft Fee. Perhaps a member of staff can clarify this?
**** This is currently the case for the existing Reward Current Account, and will be applied to the U.R.C.A and relaunched Current Account from 06/12/09.

Disclaimer: some of this information is speculative, and although I'd imagine it will come to fruition we will need to wait until we receive mailing from HBOS to confirm. Therefore this should not be regarded as Gospel truth (as with any post on MSE) until it comes from the horse's mouth i.e. Halifax Bank of Scotland.

These charges are starting from 6th December, and the existing High Interest account, and basic current account will all be changed to the Reward account and will be subject to the daily overdraft fees.

This is great news if you never use your overdraft and credit £1000 a month, you will get £5 for this.

Good news if you regualry exceed your overdraft limit. At the minute you could be charged 3 charges of £35 each day for every unpaid/paid transaction, and a monthly £28 unauthorised overdraft fee. With these changes it would be £5 a day every day you are over limit.

Not so great if you use your overdraft a few times a month or dont pay £1000 in each month, these changes may cost you a few quid each month, but worth checking how much debit interest you pay at the end of each month now, it maybe a few quid anyway.

Bad news if you live in your overdraft. It will be very possible for you to be charged £31 a month for remaining within your overdraft.

Another option, the Ulitmate reward account offers £300 fee free overdraft for a £12.50 fee. Worth considering if you use only a small overdraft.

Cardcash is disappearing for over 18's and this has been getting gradually phased out. Existing cardcash customers are being automatically upgraded to the Reward account or downgraded to Easycash depending on individual circumstances, (prob best to try and upgrade now rather than waiting.)

Both cardcash & easycash accounts are likely to keep the existing bank charging structure.

Hope this helps