First Direct Current Accounts - A WARNING

star1_2

I've discovered to my horror (while preparing my tax return and working out interest) that First Direct ceased paying intrest in Nov 07. After contacting FD they claimed they wrote advising this (I have no record of this - plenty of overdraft offers etc.), i've raised a complaint to cutomer relations concerning this, pointing out "had they made me aware I would not have kept thousands in a non-intrest bearing account".... (they've been happy to see the thousand's in there and have never suggested that it should be moved to other accounts etc) .... I'm now awaiting their response....

I've been with FD since they started, and have considerable sums of money with them .... this incident has left me feeling angry and fuming .... the bank that i've been with for years, who i've entrusted my money to have let me down badly .... if FD don't rectify the matter i'll be taking my business to another bank .... on that subject does anyone have any opinion with regards to the A&L current account offerings? .... (it's where i'm looking to take my business)? thanks :rolleyes:

Paul_Herring

plenty of overdraft offers etc.

T&C changes generally, for other banks at least, appear on dull looking pieces of paper stuffed in amongst highly glossy advertisements to secure loans against your house and/or your first born.

Do you dilligently scrutinise every piece of paper in every item they mail you? They're easy to miss.

(Incidentally, how often were they paying interest when they were doing it?)

YorkshireBoy

Paul_Herring wrote: »

(Incidentally, how often were they paying interest when they were doing it?)

Looks like monthly (at 1.98% gross p.a./2% AER), according to their previous rates page.

Milarky

I don't understand how the OP missed the change to remove credit interest last November... It's not as if FD didn't blow its own trumpet at the time... They rebranded to go 'all black'.. They rechristened the current account to a 'first account' (how could you not be aware of this - on statement headings etc?) They also brought out linked products at the time and in due course ('Everyday E-Saver, Regular Saver, Fixed Rate Regular Saver ISA) that people here and elsewhere were discussing widely. The quid pro quo for the loss of 2% in-credit interest was £250 of interest-free overdraft....

How was this all missed by the OP for 9 or 10 months (including presumably, the fact that no interest was being received each month) yet it somehow becomes First Direct's fault for not informing them? (I certainly got new T&Cs ahead of the change) In fact First Direct send me leaflets for many things I don't wan't as well - they are the 'busiest' bank I know for unsolicited mail.

star1_2

In my situation i'm fuming - as far as im concerned I was'nt advised ....

I dilligenty keep all paperwork, and have no T&C's or letter advising of the removal of intrest, nor did FD send me an electronic message to advise of this either (which they are keen to do in many other circumstances), my corrispondnace includes such changes as charging for text message banking, numerous directory offers etc .... and various changes to T&C's, but nothing to reflect the removal of current account intrest .... I noticed the re-branding (it was hard to miss, they've done this about 4 times since I joined as a customer at the start), but many companies undergo a rebranding exercises and product name changes .... and don't make fundermental changes like this, without advising customers !- i'm afraid that I dismiss the name change and rebranding suggestion .... it's the legal advice of a fundermental change to T&C's thats at issue !!

Why i've only just discovered this .... As i've numerious savings accounts with FD and they are set up to pay the intrest into the current accounts, my statements each month contain many lines with intrest each month, it's only since Nov 07, the intrest payable on the current accounts cease, the others have continued. An obvious full review of my statments to prepare my tax return revealed this !

I've a back ground in working in law and finance - in my opinion in these circumstances it's going to be down to FD to prove they advised me, given the types of accounts I have, and the way I mange them it's clear to see that - I would'nt have continued to run my accounts in this way (if I had known intrest wasn't payable), even the supervisor I spoke to agreed ! (Personally I was surprised that I got an effective "admission" on a recorded line, of this nature from a FD member of staff) .... anyway .... i'll see what happens ....

PS - I remember in previous years, when calling FD, they would always be keen ro make recomendations to help you gain the most intrest from your money and assist with the opening of accounst etc .... and suggest where to move it .... again - on this occasion .... no such direction from the financial organisation i've entrusted £?00,000's too ..... I wonder why? .... I wonder if they realize their ommission to send this paperwork to - will loose them a previously loyal customer who has helped with their loans to saving ratio !!

sofa_surfer

star1 wrote: »

In my situation i'm fuming - as far as im concerned I was'nt advised ....

I dilligenty keep all paperwork, and have no T&C's or letter advising of the removal of intrest, nor did FD send me an electronic message to advise of this either (which they are keen to do in many other circumstances), my corrispondnace includes such changes as charging for text message banking, numerous directory offers etc .... and various changes to T&C's, but nothing to reflect the removal of current account intrest .... I noticed the re-branding (it was hard to miss, they've done this about 4 times since I joined as a customer at the start), but many companies undergo a rebranding exercises and product name changes .... and don't make fundermental changes like this, without advising customers !- i'm afraid that I dismiss the name change and rebranding suggestion .... it's the legal advice of a fundermental change to T&C's thats at issue !!

Why i've only just discovered this .... As i've numerious savings accounts with FD and they are set up to pay the intrest into the current accounts, my statements each month contain many lines with intrest each month, it's only since Nov 07, the intrest payable on the current accounts cease, the others have continued. An obvious full review of my statments to prepare my tax return revealed this !

I've a back ground in working in law and finance - in my opinion in these circumstances it's going to be down to FD to prove they advised me, given the types of accounts I have, and the way I mange them it's clear to see that - I would'nt have continued to run my accounts in this way (if I had known intrest wasn't payable), even the supervisor I spoke to agreed ! (Personally I was surprised that I got an effective "admission" on a recorded line, of this nature from a FD member of staff) .... anyway .... i'll see what happens ....

PS - I remember in previous years, when calling FD, they would always be keen ro make recomendations to help you gain the most intrest from your money and assist with the opening of accounst etc .... and suggest where to move it .... again - on this occasion .... no such direction from the financial organisation i've entrusted £?00,000's too ..... I wonder why? .... I wonder if they realize their ommission to send this paperwork to - will loose them a previously loyal customer who has helped with their loans to saving ratio !!

I hope the background in law and finance helps you take back what you think they owe you.
On another track: £?00,000's - in a 2% current account - pahleeese, brother.... Seems also that in your post you are lamenting the end of a 'relationship' with a 'trusted pardner' here. You'll get over it.

star1_2

"I hope the background in law and finance helps you take back what you think they owe you.
On another track: £?00,000's - in a 2% current account - pahleeese, brother.... Seems also that in your post you are lamenting the end of a 'relationship' with a 'trusted pardner' here. You'll get over it." - :rotfl: LOL - Yes, i'll get over it !!!! (thanks)

I was a great advocate of FD in the early years and thought the concept and what they offered was great - thats why I chose to bank with them .... they introduced intrest on current accounts, online banking, free text message balance updates - but slowly they've started to remove or start charging for these services that were once free, and ironically many features that other providers have adpoted and offer free (inc intrest on current accounts) ....

IMHO - time to move .... and divorce my finances from the "trusted partner" that I feel has "done the dirty on me" .... although for a little bit of hassle for me (transfering the accounts and learning how the new provider works), they'll be the one that looses out in the long term - from the profit generated from my future custom ....

gt94sss2

star1 wrote: »

I dilligenty keep all paperwork, and have no T&C's or letter advising of the removal of intrest, nor did FD send me an electronic message to advise of this either (which they are keen to do in many other circumstances), my corrispondnace includes such changes as charging for text message banking, numerous directory offers etc .... and various changes to T&C's, but nothing to reflect the removal of current account intrest .... I noticed the re-branding (it was hard to miss, they've done this about 4 times since I joined as a customer at the start), but many companies undergo a rebranding exercises and product name changes .... and don't make fundermental changes like this, without advising customers !

From memory, when First Direct rebranded they sent at least 2 or 3 mailings to everyone explaining all the changes, the new accounts they were offering including the fact that they would no longer pay interest on a current account (unless you have an offset mortgage)

Regards
Sunil

Paul_Herring

star1 wrote: »

In my situation i'm fuming - as far as im concerned I was'nt advised ....

I dilligenty keep all paperwork, and have no T&C's or letter advising of the removal of intrest,

If, as YB said, they paid interest monthly, how come you did not notice no interest on your statements for nearly a year? For 10 months they sent you paperwork telling you, you had no interest that month....

Sorry, but I hardly call that diligent.

Compare else-thread with the people who noticed that LTSB had been underpaying interest shortly after they started doing it.

Grandmasu

Hi, I would count myself as financially very naive and mostly do not read all the small print terms and conditions. However I was well aware of the change, it MUST have been in large print or something that really caught my attention as I probably would not have noticed.

I find it difficult to believe that some-one so financially savvy as star1 could not have been aware, if I remember rightly they increased the interest rate on the savings account at the same time.

I am more than happy with First Direct, on one occasion they pointed out to me that it would be more beneficial to delay moving money from savings to current account by one day. Yes they are a business but I do feel they care.

YorkshireBoy

gt94sss2 wrote: »

From memory, when First Direct rebranded they sent at least 2 or 3 mailings to everyone explaining all the changes

Indeed, a search of these boards from last September has revealed that an e-mail was sent initially (and which mentioned the removal of in-credit interest), in which they said that they would forward full details in the post.

To not receive one communication is possible. To not receive both...?

I think the reason star1 failed to spot the loss of (£4/month on £3,000...s/he said "thousands" so I'll assume 3 of 'em) interest was due to the 'activity' on the account...what with all the other interest payments from the "numerous savings accounts" landing there each month.

The fundamental question, though, is why someone with a "background in finance" would keep so much money in an account paying so little interest (1.98% gross p.a.)...especially since s/he clearly has "numerous savings accounts" that would have been a better home for said money.

And even more fundamental, with "hundreds of thousands" passing through/entrusted to the organisation, surely it's best to check your money is working for you more often than once per year to complete a tax return?

It's human nature to 'smart' a bit when you've slipped up like this, but surely it's better to tackle the root cause (which is attention to detail) than to up sticks and move everything elsewhere...where the same will happen again if the root cause is not addressed?

OP, have you quantified the 'loss'? At an average balance of £3K (as I speculated above), it's £40 over 10 months (less if you're a higher rate tax-payer). Is it really worth the hassle of moving...since you clearly have a very large portfolio with them?