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Business Banking Help!!

I am a soletrader with a large overdraft that I have had for some years. the bank (HSBC) have increased my overdraft interest to 10% (and not even in writting) and these charges are going to put me out of business. What to do?? My mananger wont even discuss it with me, just says thats the way it is as your a risk account. I am managing my account, holding back paying who I can but the bank keep on taking there interest charge even if it is taking me over my limit. They also want me to pay back the whole overdraft asap! Its huge as my business has to carry alot of stock.
I feel if I kick up too much of a stink they will shut my account and put me out of business. They have me over a barrel and they know it.

Comments

  • I think a lot of small businesses are suffering similar problems. After 8 years of successful trading ours certainly is. I’ve always found the banks to be inflexible towards small businesses anyway but I doubt bankers even cross the road these days as it’s too risky!

    What I have found though is suppliers, HMRC and landlords do take a bit more of a sensible approach. Our landlord has offered us a rent free period and we’ve got a deal to pay our latest VAT and PAYE over the next year. They know if we go under that they stand to lose more. So my advice is get negotiating with these people. It might buy some time.

    Unfortunately for us it looks like it’s not going to be enough as trade is just dire – but it was worth a try.
  • 92HG wrote: »
    I am a soletrader with a large overdraft that I have had for some years. the bank (HSBC) have increased my overdraft interest to 10% (and not even in writting) and these charges are going to put me out of business. What to do?? My mananger wont even discuss it with me, just says thats the way it is as your a risk account. I am managing my account, holding back paying who I can but the bank keep on taking there interest charge even if it is taking me over my limit. They also want me to pay back the whole overdraft asap! Its huge as my business has to carry alot of stock.
    I feel if I kick up too much of a stink they will shut my account and put me out of business. They have me over a barrel and they know it.

    whats your personal circumstances mate, do you own a house, mortgage, rent, have family, hows your turnover, cashflow and GP, if you have a huge overdraft are you sliding backwards? what do yoy take as drawings/wages? can you up your prices 5% and cut your payment terms (to get paid faster), any business not making a true profit isnt viable, or could you sell your stock without ordering then go on a JIT basis, holding less stock? (all the supermarkets do it!)
    Now we all know how it felt to play in the band on the Titanic...
  • Manky wrote: »
    I think a lot of small businesses are suffering similar problems. After 8 years of successful trading ours certainly is. I’ve always found the banks to be inflexible towards small businesses anyway but I doubt bankers even cross the road these days as it’s too risky!

    What I have found though is suppliers, HMRC and landlords do take a bit more of a sensible approach. Our landlord has offered us a rent free period and we’ve got a deal to pay our latest VAT and PAYE over the next year. They know if we go under that they stand to lose more. So my advice is get negotiating with these people. It might buy some time.

    Unfortunately for us it looks like it’s not going to be enough as trade is just dire – but it was worth a try.

    OH NO THEY DONT!

    cross them and your dead meat mate
    Now we all know how it felt to play in the band on the Titanic...
  • Yes if you agree something with HMRC and don't pay then I'm sure that they get a little upset. However I had a £30,000 VAT bill that was due to be paid but they've agreed that I can pay over a year which I think is quite reasonable. I asked the bank for a £10,000 overdraft for six months and they said no.
  • LilyBart
    LilyBart Posts: 1,171 Forumite
    Hello 92HG,
    The only good thing about your dilemma is that banks and small businesses are a big story at the moment. Assuming you've done everything above board in your business hitherto, it's a long shot but write to your local MP and, if you know someone on the local paper, talk to a reporter there. The banks are supposed to be under pressure from the government to help small businesses survive, so try and use this for leverage.
    Good luck
    Lily
  • 92HG
    92HG Posts: 8 Forumite
    Yes we have made arrangements with landlords, HMRC & Suppliers (Suppliers getting very very annoyed now) but its the bank that increased the interest charge on the overdraft and wont listen to us to help us.
  • 92HG
    92HG Posts: 8 Forumite
    Personally I have several rental properties including one in Portugal which are all doing fine (apart from I cant sell due to the market). i also have a lot of business loans which are a big problem. without these the business would be doing just fine. but since the bank are forcing me to pay some overdraft off (which is an agreed overdraft) I am having to do the sin of releasing equity out of my portugal property to pay creditors and the bank. My son inlaw is investing in the property so the mortgage wont hurt too much.
    Its the [EMAIL="f'@@king"]f'@@king[/EMAIL] HSBC that dont seam to have a problem with pulling the plug on me even though they will lose so much more in the long run.
    Arrrh
  • 92HG
    92HG Posts: 8 Forumite
    Thanks, i know where your coming from but I feel that kicking up a fuss with the bank will lead them to close my account.
    And especially after todays discussions in the house of commons!!
    HSBC take the p#ss, £75 charge for a returned DD! are they having a laugh
  • 92HG
    92HG Posts: 8 Forumite
    Thanks for your replys. hoping for some good news at the end of the week, basically it will be make or break! Will let you know, but trust me if I go under the HSBC will have a lot to answer for and when I am finally straight (fingers crossed & positive thinking) I will claim the bank charges back and were talking at least £10K!
    ps new to this yesterday so if Im not posting things in the right places forgive me
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