RBS - the way they process bank charges

duncain

I’m currently in dispute with RBS in relation to the way they apply/ process bank charges to current accounts. In brief, my son tends to be a bit scatter-brained when it comes to managing his finances and had asked for my help in trying to avoid incurring unnecessary bank charges. As part of this we had been monitoring his account online to identify exactly when charges were being taken. We then discovered that RBS were applying charges retrospectively by one day - thereby making it impossible for customers to redress any resulting shortfall in their accounts. To cite an example, each month RBS when applicable issues a statement of any bank charges incurred and specifies the date (eg 16th November) when they intend to debit these from the account. However, in practice these charges are not processed until the following day (17th November) but are retrospectively dated by one day on the account (16th November). In situations where these charges result in the account becoming overdrawn, this makes it impossible for customers who may have only just noticed the transaction the same day to redress the balance. Inevitably this will result in another set of charges being incurred. After raising my concerns with RBS they eventually conceded that ‘charges are applied overnight and show as being debited the previous day’. However, when challenged why these charges could not be applied timeously on the date previously intimated on the statement of bank charges, they refused to give any reason. I subsequently made a complaint to the Financial Ombudsman Service who after considering the evidence commented that they had ‘no power to order or recommend that a business should improve its level of service, its administrative procedures or alter its policies’. Although the content of this thread is likely to affect only a small minority of RBS customers, I would also argue that the retrospective manner in which these charges are processed totally undermines the transparency of the RBS online banking system - a system which is presumably intended to provide customers with a timeous snapshot of the status of their accounts.