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HSBC Graduate account - Interest Free Overdraft

dansylvester
dansylvester Posts: 48 Forumite
Part of the Furniture 10 Posts Combo Breaker
in Budgeting & bank accounts
When I first opened my HSBC graduate account in July 2006, I was told that my interest free overdraft would reduce each year by £500 from £1500. My account today was due to change down to £500 interest free, but I checked my account today and I have been changed to a standard bank account, with no interest free overdraft. I went into the bank today and was told the deal when I opened my account no longer exists, and that graduate accounts no only last for 2 years. I was never notified of this and if I had not noticed the change in the account type on internet banking, I would now be being charged interest at nearly 20%. Are HSBC under any obligation to inform me when my overdraft limit changes?

Any help considered, I am already looking for a new bank account, and will be leaving HSBC in the next few weeks.

Comments

  • dexters_mum_2
    dexters_mum_2 Posts: 860 Forumite
    500 Posts
    I think that the stance would be that they can withdraw an offer at any time, unfortunately and it is July 2008 now, so they would've automatically graded your account according to the new T&C's.
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  • TrickyDicky
    TrickyDicky Posts: 666 Forumite
    Part of the Furniture 500 Posts Name Dropper Combo Breaker
    My only thoughts are that correspondance may be going to an old address? they should have informed you via post, but as students often change address every year, its quite easy to forget to inform of new address.

    In addition, if you are overdrawn into your interest free overdraft and dont make any payments in for a few months, they will transfer you to "a more appropriate lending product". Did you make any kind of payments to keep the account active? and then does this tie in with the first question?
  • Crabman
    Crabman Posts: 9,936 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Photogenic
    Strange, I've been on the HSBC Graduate account for a year and today was informed that following the 'overdraft review' last month, the letter was actually an error, the offer is withdrawn immediately and I am being charged interest as of two days ago. Has anyone else received something along these lines? :rolleyes:

    I've just filed a complaint via the Financial Ombudsman Service as this is unacceptable. In the meantime I wonder whether this is another one-off or a fresh round of trickery from HSBC... :confused:

    Who can forget their scheming antics this time last year? HSBC really need a copy of the Banking Code...
  • dansylvester
    dansylvester Posts: 48 Forumite
    Part of the Furniture 10 Posts Combo Breaker
    "In addition, if you are overdrawn into your interest free overdraft and dont make any payments in for a few months, they will transfer you to "a more appropriate lending product". Did you make any kind of payments to keep the account active? and then does this tie in with the first question?"

    Just to clarify, my account is (soon to be was!), my current account, with all my wages paid and DDebits paid out. Iv transferred some money from my ISA to keep the account in the black, so hopefully should get much interest charges, but still very annoying they have done this with no warning. Still had no letters, and always kept them informed of my address, been at my current for nearly 18 months.
  • robertster
    robertster Posts: 1 Newbie
    Crabman wrote: »
    Strange, I've been on the HSBC Graduate account for a year and today was informed that following the 'overdraft review' last month, the letter was actually an error, the offer is withdrawn immediately and I am being charged interest as of two days ago. Has anyone else received something along these lines? :rolleyes:

    Exactly the same has happened to me - after I was told by HSBC on the phone that I would retain graduate account for another year.

    Disgusting behavior from HSBC.
  • Crabman
    Crabman Posts: 9,936 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Photogenic
    robertster wrote: »
    Exactly the same has happened to me - after I was told by HSBC on the phone that I would retain graduate account for another year.

    Disgusting behavior from HSBC.
    Hi robertster - Welcome to MSE :D

    There have been many posts about this issue on various threads & boards - I'd suggest you contact the Financial Ombudsman Service and use them to register a complaint against HSBC, citing that minus 2 days notice of charging for an overdraft which was previously advised as interest-free for the next 12 months, is not on.

    It also seems to be in breach of the Banking Code to not give a customer 30 days notice of a change to Terms/Conditions and allow 60 days for the customer to transfer away without penalty, if any change is in their favour.

    Here are a couple of other threads on this subject:

    HSBC Graduate Overdraft - no longer interest-free!
    HSBC Overdrafts!
  • Gosia
    Gosia Posts: 579 Forumite
    Part of the Furniture
    Hi

    I too have a student account with HSBC but have received a letter from them on Monday stating that I should ignore their previous correspondence (from 2 weeks ago) as they've now reviewed their policy due to the complaints received from customers, and my overdraft facility will not be changed until November of this year!

    Still I think it will entail having to pay interest on my overdraft.

    I was thinking of changing to the Alliance & Leister current account as they have an interest free overdraft for 12 months plus a welcome payment of £100.

    I was however wondering whether I should phone HSBC and tell them that I am considering changing to another account. Does anyone think this would make HSBC reconsider - whereby they would offer me a better deal???

    :rolleyes:
  • SiuLoong
    SiuLoong Posts: 218 Forumite
    My fiancee has the same problems with HSBC - we've had problem after problem for the last 12 months or so and as soon as the new graduate accounts are released for next year will be switching. We have opened an A&L account but the overdraft is only 12 months, if you switch to a graduate account with another bank you get the same sliding scale o/d as if you had a student account with them. Look at the article in the savings area for more details.. it is due to be updated soon when next years deals are announced so we are going to hold fire and switch to the best of the new deals. (Incidentally, I am with Natwest for my graduate account and have no problems.. although use a different current account for day to day use!)

    http://www.moneysavingexpert.com/banking/graduate-bank-accounts
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