Bank charges

IvanOpinion

stugib wrote:

You make it sound like the banks will be on their uppers if they are stopped from inflicting extortionate bank charges so they'll be forced to look elsewhere to make their money. How much of a dent in their £3.47bn/4.8bn/5.28bn/7.94bn/11.5bn (for the big 5) a year profits will reducing these charges make?

I would say very little but it might be enough to give them an excuse to shut down a few more local branches etc. However the overriding factor is that the banks will NOT be the losers in this .. the customers will.

And what makes you think they won't try to do these sleight of hand tricks anyway even if high charges remain - they're greedy barstewards - if they think they can get more money out of us they will.

THANK YOU .. A MASSIVE THANK YOU .. that is exactly my point .. irrespective of what happens if a bank wants more money they will get it (its a bit like the government in that way) ... what they give with one hand they will take straight back with the other. I reckon we will ALL end up paying for this .. maybe thats why they don't contest these awards in the courts .... maybe they are already 'adjusting' the interest rates on our loans, mortgages and pensions to cover any perceived or otherwise losses?

To me the bigger picture is for someone to explain why some accounts only pay something like 0.25% interest ... why are the financial institutions not using their massive profits to sort our peoples endowments ... why do some banks charge 6% mortgage rate when the base rate is 4.5% (33.3% markup). Why are annuities so poor ... that is your money but quite likely the bank will end up with the biggest share of it? If people managed their money better then the issue of charges would go away and we could then address the bigger issues.

Ivan

mikemoate

I can see both sides of this discussion. In amongst it all both sides make good points. Just to throw in another dimension. I was wondering if the banks employed vastly different interest rates for agreed and unauthorised overdrafts, incorporated into t&c's, and actually charged the cost of sending advisory notes (threatening letters) to customers, would every body be happy? Thus if they didn't process a transaction you would just pay the cost of the letter, but if they did process it and you went overdrawn you would pay a higher interest rate.

stugib

IvanOpinion wrote:

THANK YOU .. A MASSIVE THANK YOU .. that is exactly my point .. irrespective of what happens if a bank wants more money they will get it (its a bit like the government in that way) ... what they give with one hand they will take straight back with the other.

There's really no need because you're missing my point - you're were saying that forcing the banks to stick to proportionate/reasonable/lawful/whatever bank charges will mean they'll screw us for money elsewhere. You've now just admitted they'll do that anyway, so why should they be able to continue to get away with disproportionate charges?

Astaroth

stugib wrote:

How much of a dent in their £3.47bn/ 4.8bn/ 5.28bn/ 7.94bn/ 11.5bn (for the big 5) a year profits will reducing these charges make? And what makes you think they won't try to do these sleight of hand tricks anyway even if high charges remain - they're greedy barstewards - if they think they can get more money out of us they will.

As I have already said, the fees earned from unauthorised borrowing or such is a very small percentage of any banks income however we have to remember that most banks are PLCs and therefore answerable to their shareholders. The top people in the banks are only there by the grace of the shareholders and if profits were to slip, or simply not grow as expected they could quickly find themselves out of a job.

Given that I work for one of the companies who's profit lines you quoted I can assure you that anything that has any potential for even minor cost (financial, reputational etc) has to go to a rediculously high level for authorisation. In a recent project costing a meer £300k (which is very small for the type of work I normally do) which involved simply getting a new introducer on board it required going to the Group CEO for approval. It is probably a slight exageration but the directors of these banks in my experience are scared of the power of a shareholder.

Astaroth

stugib wrote:

There's really no need because you're missing my point - you're were saying that forcing the banks to stick to proportionate/reasonable/lawful/whatever bank charges will mean they'll screw us for money elsewhere. You've now just admitted they'll do that anyway, so why should they be able to continue to get away with disproportionate charges?

It comes down to a simple question really doesnt it.... should it be everyone who pays or should it be the people who miss manage their money/ breach the terms they agreed to obey?

Whilst there is an ethical arguement that the rich should support the poor we have to remember that there are lots of "poor people" out there who struggle to make ends meet but do not get bank fees because they dont do things wrong so by saying everyone should pay you will be hitting them the hardest. (and to be honest, when I see my over £2000 of tax/ ni deducted every month from my payslip I feel that I do support the "poor" well enough already)

IvanOpinion

mikemoate wrote:

I can see both sides of this discussion. In amongst it all both sides make good points. Just to throw in another dimension. I was wondering if the banks employed vastly different interest rates for agreed and unauthorised overdrafts, incorporated into t&c's, and actually charged the cost of sending advisory notes (threatening letters) to customers, would every body be happy? Thus if they didn't process a transaction you would just pay the cost of the letter, but if they did process it and you went overdrawn you would pay a higher interest rate.

Some banks do have different options for accounts mainly in credit versus accounts that occasionally/often dip into debit. People often think it is only a letter however the production cost to a business of a letter ranges from about £3 to about £8 (different quotes I have seen .. or £25 if you are an ambulance chaser). So people getting 2-3 letters a month due to their mis-management could easily end up worse off.

Ivan

IvanOpinion

stugib wrote:

There's really no need because you're missing my point - you're were saying that forcing the banks to stick to proportionate/reasonable/lawful/whatever bank charges will mean they'll screw us for money elsewhere. You've now just admitted they'll do that anyway, so why should they be able to continue to get away with disproportionate charges?

I haven't 'just admitted' I have been saying that all along and this whole 'cause' is just providing another excuse for banks to find another way to get more money from the customer ... the difference is that the consumer will probably have to give up the right to contest the charges. You called them 'greedy barstewards' .. you are probably right and while the public remains dumb and irresponsible they will benefit from it .. would you not?

Simplest example I can think of (I have already quoted this) ... less than 10 years ago when you wanted a new mortgage you simply shopped around looked for a deal and signed a few forms .. nowadays you do exactly the same except that a fee ranging from £200-800 changes hands. Considering many of the 'deals' are only for a 2-3 years this UP-FRONT payment that many people embed in their mortgage gets interest charged on it many times over ... but it does allow the marketing people to provide the buyer with a piece of paper showing a very low interest rate in big letters. Can anybody explain to me how it takes that amount of money to set up a mortgage?

People are that concerned about £10 here, £20 there, charges that THEY agreed to pay (they could have gone elsewhere or could manage their money better .. although in this day-and-age it appears that peoples signatures and word is worth less than the ink it takes to write it) .. I diverse .. they are that concerned about small amounts while they totally ignore the hundreds and thousands that they are losing elsewhere. I am also nervous that we are going to see more and more 'elitist' products were the poorer end of the market can not benefit .. simple because they can not afford to buy into them.

If EVERYBODY managed their money better and spent within their means then EVERYBODY would be better off. The banks would still be making exactly the same profits .. but remember banks making profits generally benefits EVERYBODY because we are ALL shareholders in some way. After all it is better that they make profits rather than have to shut down and then we lose every penny we have invested

As consumers we have to become much more savvy, we have to be able to see through the advertising and the marketing ... THEIR job (and part of my job) is to promote and sell you rpoducts, YOUR job (and mine) is to see through the small print. I would argue that it is far better to stop the problems from arising rather than attempting to shut the stable door after the horse has bolted. We all have to take responsibility for ourselves.

Ivan

CAT-THE-FIFTH

I think banks also should realise it is us that are keeping THEM afloat and not the other way around!!

More than the charges it is the apparent lack of respect and customer service that many banks show towards their customers even after many years of holding a good account.

Trying to drain people of their money for silly little things or minor overdrafts(READ:NOT hundreds of quid) smacks of over-indulgence.

If it costs them 70 quid just because someone goes over their limit by one pence is ABSURD.

If they are SO inefficient I fully support them firing some of their excess personal or paying them less- after all I want an efficient service too!!

I think the government needs to look into this and some of the European commissions as this is clearly not very "competitive" free market behavior

IT SEEMS LIKE PRICE FIXING

RichyRich

CAT-THE-FIFTH wrote:

If they are SO inefficient I fully support them firing some of their excess personal or paying them less- after all I want an efficient service too!!

That's right, let's promote mass unemployment and the offshoring of jobs, then we can all complain about not being able to find a job and companies not supporting the British economy...

CAT-THE-FIFTH

Well it seems the WTO/World Bank can do this to poorer countries -so what is the big deal??!!

If you want rude people in a bank then good for you.

Perhaps they should find some decent people from "here" instead of the idiots at the call centres at Natwest who act like they are doing the customers a favour not the other way.

If people cannot act professionally and politely to customers but try to be argumentative and downright rude and abrupt to customers they should lose their jobs.

Call centres are about customer service- if they do not like the job then they should find another one.

This applies to everyone.

I too have had to do job which I really did not have to do but I had to survive and I made sure that I did it as well as possible.

Monotony is not nice in a job but think of all the less luckier people - at least those people have a job and should put 110% into it,not 10%.

It is all about the work ethic.

If someone was very rude to customers in a supermarket they could stand a good chance of being fired if customers complain repeatedly

However call centre folk seem to get away with this.