HSBC increasing charges, suggestions for an alternative?

zcacmxi wrote: »

Excluding the 18 month initial free period that the big 4 banks all seem to offer, the monthly fees appear to be:

Lloyds £5.00
Natwest £5.00
Barclays £5.50

And now HSBC are introducing a £5.50 charge...

Doesn't seem right to me, they're all charging around the same amount and the amount chosen has nothing at all to do with the costs involved, as clearly they can all afford to do it for free for at least 18months, and in HSBC's case a lot longer prior to Sept.

They charge £5.50 because they all do and they can get away with it. Seems Metro Bank is the only way to go, especially if you're in London.

HSBC charge £5.00 per month today for their small business banking - this will also rise to £5.50 per month from September.

It's only the HSBC Business Direct account that was designed primarily for electronic transactions that had no monthly charge.

Some equivlients elsewhere include the RBS Business Banking Direct (that has no monthly fees at present) and Bank of Scotland Business Internet Banking which currently has no monthly fee, but a £5 monthly fee will be introduced next month.

Oddly, in HSBC renaming 'Business Direct' to 'Electronic Banking' to better reflect it's intended use, they are reducing fees for many non electronic transactions (but perhaps this is offset by the fact there are no free allowances per month, e.g. 5 transactions free)

I don't follow your suggestion that the monthly fee does not reflect the cost when all seem to be (or will soon be) about £5 per month. Perhaps you have some evidence to support that allegation?

But yes, the banks are commercial organisations, owned by their shareholders. Their aim is to provide financial returns for those shareholders (and many taxpayers are currently shareholders of some of the big banks).
So yes they do charge what they can get away with subject to limitations set by their competitors. That's how business works; those of us in business realise that (hopefully).

Headly wrote: »

Exactly. And HSBC's letter of advice regarding the withdrawal of their free banking is quite patronising, stating:

"We are making changes which we believe will make our charges clearer and make it easier for you to manage your costs."

So paying fees is now easier to manage than not paying fees?

I'm not trying to defend the bank in any way (in fact I'm looking to ditch & switch myself) but after I read this, and thought about it, I think I understand where they are trying to come from.

At present, if you exceed the free allowances, you start getting hit with very high transaction charges. Now you know all chargeable transactions will be charged at the same, lower rate it will be easier to manage.

Headly wrote: »

and

"We are removing the free monthly allowances which means you will only pay for what you use."

Huh?

I think what they are getting at here is that once you exceed the small number of free transactions, you currently are hit with high transaction charges which presumably subsidise the free transactions yoou were given and those who don't pay any charges at all.

In future, you only pay the lower transaction charge that presumably more accurately reflects the cost involved. You will pay these on all chargeable transactions, but so will everyone else, so no subsidising the freebies currently on offer

HTH

Headly wrote: »

Or Cater Allen if you keep £5000 or more on deposit.

That again comes out about the same monthly cost.
£5k in a deposit account at say 1% is £50 a year - not much lower than the big banks charge will charge over the year in monthly fees.

darrinm81 wrote: »

Spoke to RBS about their Business Banking Direct.

No account maintenance fee. Free internet banking. Includes free debit card. Credit card at £32 per annum.

You can apply online or by phone - takes approx 10 working days.

Unless I missed something this appears to be a free account that would suit most who don't need a dedicated Relationship Manager and can get by with Internet Banking.

http://www.business.rbs.co.uk/afb/public/rbs/
Business Banking > Accounts > Current Accounts

I feel more comfortable with parking my money with a UK High Street brand.

This is the account I have. Somebody asked earlier about depositing cheques - they give you free envelopes to post cheques off in, so they are usually in your account within a couple of days.

Somebody mentioned icici, no way would I go there for business banking, got a personal account there and the website is soooo user-unfriendly, I'd rather pay for a business account than have their account free.