Alliance & Leicester charging £5 per month for nothing

overcharged

Hi Moneysavers!

I'd really appreciate any suggestions or advice on the following impending Alliance & Leicester bank charges I'm about to endure, which I see as needless. In particular, if anyone has had any experience of this "£5 fee" I'd love to hear from you. I would love to know where I stand before writing them a letter, or phoning them if I really must.

Well, I'm been funding my Alliance & Leicester Premier Direct Current Account with only a couple of hundred quid per month since I left my fulltime job. I received a letter from Alliance & Leicester which says:

You are not currently funding your Premier Direct Current Account with at least £500 a month. If you decide to make at least the minimum monthly payment into your Premier Direct Current Account starting this month, you do not need to contact us. However, we will take a £5 fee from your account for each month where you pay less than £500 into your account.

They say I have 'great benefits' to this account:
* a linked PlusSaver savings account,
* access to offers on "all kinds of financial services"
* free European annual multi-trip travel insurance if you opened your account before 3 October 2005 (irrelevant to me as I opened my account 2 years ago)

The only 'financial services' I need are the use of my basic Debit Cash Card and the use of their cash ISA. That's it. Having said that, I could easily take my ISA allowance elsewhere. I don't use their credit card and don't touch their 'PlusSaver savings account'.

They mention "...it may be that our standard Current Account is better suited to your needs. In this case, please call customer services on the phone number shown on your latest statement. However, please remember that if you do switch to this account, you will lose all your Premier Direct Current Account benefits."

Any suggestions would be genuinely appreciated. I just think it's crazy that despite me paying money into my account, they intend to charge me! I'm also concerned that if I opt for their standard Current Account, it could be a minefield of hidden charges or "fees" as they politely call them!

esmerellda

Switch accounts to the standard current account. You don't need the ''benefits'' you are paying £5 a month for and if your income is going to continue to be lower than £500. The charges will be pretty much the same and if in doubt have a look at the terms and conditions for both accounts before switching.

Its not a penalty the £5 so you won't be able to reclaim it.

overcharged

esmerellda wrote: »

Switch accounts to the standard current account. You don't need the ''benefits'' you are paying £5 a month for and if your income is going to continue to be lower than £500. The charges will be pretty much the same and if in doubt have a look at the terms and conditions for both accounts before switching.

Its not a penalty the £5 so you won't be able to reclaim it.

Thanks Esmerellda

I'll just write to them telling them I want to keep my ISA but to switch to the standard Current Account, to avoid the £5 fee.

Thanks again

bengal-stripe

overcharged wrote: »

.......but to switch to the standard Current Account, to avoid the £5 fee.

Or bank at least £ 500 per month.

overcharged

bengal-stripe wrote: »

Or bank at least £ 500 per month.

Yep, but sadly I don't have £500 a month to be able to bank. Would like to though!

shaf00uk

Here is another tip but it will require some effort.

You may be able transfer funds of £500 between the current account and plus saver account. The T&C state you must credit at least £500 per month - there is nothing there that states you can't take out £500 from the current account and then simply put the same £500 back in the next day!

The other less safe option is going to branch to take the money out and putting it back in another day.

You will save £5, plus earn interest if you are in credit. But you need to take into account time, perhaps fuel and effort so it may not be completely worth it.

overcharged

shaf00uk wrote: »

Here is another tip but it will require some effort.

You may be able transfer funds of £500 between the current account and plus saver account. The T&C state you must credit at least £500 per month - there is nothing there that states you can't take out £500 from the current account and then simply put the same £500 back in the next day!

The other less safe option is going to branch to take the money out and putting it back in another day.

You will save £5, plus earn interest if you are in credit. But you need to take into account time, perhaps fuel and effort so it may not be completely worth it.

Great tip! Thanks very much! Need to play them at their own game!

YorkshireBoy

shaf00uk wrote: »

Here is another tip but it will require some effort.

You may be able transfer funds of £500 between the current account and plus saver account. The T&C state you must credit at least £500 per month - there is nothing there that states you can't take out £500 from the current account and then simply put the same £500 back in the next day!

Apologies if I've misunderstood you, but simply transferring from current account=>plus saver=>current account won't work because the £500 mustn't come from another A&L account, ie it has to be 'new money'.

overcharged

YorkshireBoy wrote: »

Apologies if I've misunderstood you, but simply transferring from current account=>plus saver=>current account won't work because the £500 mustn't come from another A&L account, ie it has to be 'new money'.

Ah, see what you mean. Oh well, worth a try :money:

shaf00uk

YorkshireBoy, you may be correct and it makes sense.

Suggest you go for the second option by taking the money as cash out and then putting it back in again another day. It is technically "new money". The only hit is a days loss of interest.

I still believe they can charge £5 is simply wrong. I will re-read the T&C. Other current accounts pay less interest but never charge. You simply get the basic rate (usually 0.1%) for any month where you fail to meet the minimum requirements. Peeps, correct me if I am wrong. Thanks.

brightonman123

main 'benefit' may be the travel insurance, which i am sure you can get for much less than the toal £60 a year you are paying for them to lok after YOUR money! (is there any better interest paid, btw?).

switch now!