Abbey's debit interest

lindabea

Hi everyone,

Can someone please let me know if Abbey are correct in the way they're calculating debit interest as I'm no sure if they are. On 1st Aug my account went overdrawn by £3.64 as a result of a direct debit going out ie during the nt of 31/07-1/08 . On the morning of the same day, I transferred £500 from my savings account (also with abbey)which immediately appeared in my current account. When I queried this at the branch, I was informed that their system charges interest from the time I go overdrawn to the time my account is back in credit. My argument is that on close of business on 1st Aug, my account was in credit. I checked with other banks and put this scenario to them, and I was told that they would not charge interest. If Abbey are wrong, I would like to refer this matter to the Financial Ombudsman, but before I do, can I please ask for your comments.

johnmoney05

How much they charged you? Was there overdraft facility on your account?

flowerscotland

Hi

I work for abbey, and I would say this is a mistake.

Debit interest IS calculated on a daily basis BUT if you pay money in to cover an overdrawn balance the same day, you will not be charged.

Try calling telephone banking ? They could sort it out for you.

lindabea

Thank you flowerscotland for your reply. I phoned Abbey's complaints dept this am and they said that they were right in the way they're calculating the interest ie charging for the odd hours. However, everyone I have talked to so far have said that they are wrong. The woman I spoke to at Abbey was most abnoxious insisting that the debit interest was correct.

flowerscotland

i cant believe they said that to you :eek:

have you tried telebanking ? 08459 724 724, I would call them and see what they say.

lindabea

Thank you again flowerscotland. No I haven't rang tel banking as this would cost me even more. I tried the complaints dept and got nowhere - I don't think there's any point of calling tel banking as their call cente in India is even more useless. I know you said you work for Abbey, but with regret, that bank is going downhill. I have banked with them for over 20yrs, and I can say I had more problems in the last year or so than in all the previous years put together. Abbey is utterly disgraceful.

lal1234

Surely the cost of phoning them etc is more than 1 days interest on £3.64???

dollywops

flowerscotland wrote: »

Hi

I work for abbey, and I would say this is a mistake.

Debit interest IS calculated on a daily basis BUT if you pay money in to cover an overdrawn balance the same day, you will not be charged.

Try calling telephone banking ? They could sort it out for you.

I am sorry to say, but I believe you to be wrong. Up to about a year ago or more, I would have said you were correct. Occassionally, I would go overdrawn because I had forgotten to move over sufficient funds to cover paymets gong out. However, as long as I made sure the overdraft was cleared on the same day, no charges were made. We were only ever talking about a maximum of £100. Anyway, I noticed sometime last year that although I had closed out an overdraft situation on the same day, I had been charged pennies in instant overdraft interest. When I queried this, I was advised that if you are overdrawn at any time during the day, even if you clear the overdraft that day, charges will be levied.

dealyboy

dollywops wrote: »

I am sorry to say, but I believe you to be wrong. Up to about a year ago or more, I would have said you were correct. Occassionally, I would go overdrawn because I had forgotten to move over sufficient funds to cover paymets gong out. However, as long as I made sure the overdraft was cleared on the same day, no charges were made. We were only ever talking about a maximum of £100. Anyway, I noticed sometime last year that although I had closed out an overdraft situation on the same day, I had been charged pennies in instant overdraft interest. When I queried this, I was advised that if you are overdrawn at any time during the day, even if you clear the overdraft that day, charges will be levied.

Hi dollywops,

I have been following the erroneous small overdraft 'charges' issue now for the best part of a year, including the about a dozen MSE threads (and your worthy contributions). I have been a sufferer since last December of both instant and advance variants, without going into detail which would be a very long story.

It is my view that there are 57 varieties of Abbey Customer Services advice on this subject but that flowerscotland is correct. I have operated my current account in the same way for some years, only covering a debit balance by a transfer on the same day, ensuring that always the account is in credit by the end of the business day. This is on the understanding that interest is charged daily on any outstanding amount, as stated at the bottom of current account statements. The interest is not charged at an hourly rate or even a real-time rate. If it were to be then Abbey would have to inform customers of a change in terms and conditions.

My personal experience is that the 'instant overdraft interest' and 'advance overdraft interest' spurious charges bear no relation to the intra-day balances (I can go into details).

Warm regards to all.

johnmoney05

dealyboy wrote: »

My personal experience is that the 'instant overdraft interest' and 'advance overdraft interest' spurious charges bear no relation to the intra-day balances (I can go into details).

Warm regards to all.

Finally someone did make some sense on the reply. I did ask 2 questions in my post 2 above. Well, OP chose to ignore it. Without his/her answer, anyone's guess will be wasted-time!

Anyway, go luck to OP. Hope you get back what you want!

lindabea

Hi Johnney,

Sorry - I did not mean to ignore your earlier response. The amount of interest Abbey charge is small - 0.10p. But this is not the issue here. If Abbey are wrong in making this charge under the conditions which I described, then they should not be getting away with it. I know it's a small amount but if they're adopting this practice with other customers as well, then they could be earning money unethically. I don't mind paying interest/charges when this is justifiable, but judging by responses to this thread, it's clear that Abbey are in the wrong. I also checked with other banks, and they said that they would not charge interest as they calculate it on a daily basis.