Bank charges

LondonDiva

ltlmiles5 wrote:

... Instead of letting customers get more overdrawn, and charging more and makign it worse.

Nobody 'lets' anyone get overdrawn.

I get overdrawn when I miscalculate when a cheque will be paid in or if I know I don't have the money in the account then, but need to borrow money from the bank to use...

They 'let'me borrow the money at short notice & they charge me for my poor financial management. This has probably been the best motivation for staying in credit & not spending more than I have or can afford.

If the bank denied credit or access to facilities, the same people moaning about the cost of going overdrawn would whinge about being discriminated for their circumstances or poor state of finances

Mark7799

moonrakerz wrote:

Why do you seem to condone the unlawful actions of the banks, would you condone someone stealing your neighbour's car, and say it's his own stupid fault, just because they didn't steal yours ?

Taking this analogy further, what if your neighbour owned a garage but left his car unlocked on the roadway outside his house and with the keys in the ignition? You in the meantime have locked your car in your garage and the keys are safely in your house.

IvanOpinion

I think some of you are missing my point ... the banks turn in profits and have a duty to their share holders (of which most of us are) to provide decent returns. If these returns diminish then so do our pensions, our ISAs, our TESSAs, our endowments etc. etc. Therefore the one thing that is NOT necessarily in our interest is a few short term gains if we are going to lose big time in the long run.

This whole thing about reducing bank charges is nothing more than a distraction that can be easily dealt with with innovative marketing (some of which we are seeing at the minute) .. as I said before the majority of the public are gullible fools, so the marketing bit is easy. What I don;t like though is that the responsible people are (will be) paying the price for others irresponsibility. In the future I may get less interest, I may pay more for my mortgage, I might even have to pay for the privilege of having an account, we all might have to pay a monthly fee for our credit cards, all those 0% balance transfer deals may disappear.

If, as is going to be the case, everybody is going to pay more then I want anybody operating their account in a cavalier irresponsible manner to have that credit withdrawn from them immediately to minimise my losses (bounce their cheques, don't accept their credit cards, don't accept their cash cards etc.). Ideally if this happens at a check-out in Tescos an alarm should go off, a siren should sound and a spinning red light should start up at the checkout so that everybody looks round and sees who is causing them to pay more .. I would like to say that such embarassment would make them act more responsbily but given the way this country is going I think society would get dumbed down enough to ignore it very quickly.

This attitude of 'its my money' needs to be pruned back a bit because most people seem to add 'and I don't want to be bothered with managing it' .. if you want a simple life then shove it in a sock and put it under your mattress. If you are going to delegate the responsibility of looking after your money to someone else at least have the intelligence and foresight to review the many products available and pick one that suits your lifestyle. Personally I want MORE high interest paying high penalty fee accounts and MORE low interesting paying low charge accounts ... not less .. I want 'elitist' products that mean good management is rewarded.

Ivan

ltlmiles5

This attitude of 'its my money' needs to be pruned back a bit because most people seem to add 'and I don't want to be bothered with managing it' .. if you want a simple life then shove it in a sock and put it under your mattress. If you are going to delegate the responsibility of looking after your money to someone else at least have the intelligence and foresight to review the many products available and pick one that suits your lifestyle. Personally I want MORE high interest paying high penalty fee accounts and MORE low interesting paying low charge accounts ... not less .. I want 'elitist' products that mean good management is rewarded.

Ivan[/QUOTE]

It is true that many people need more help managing their finances, having been given easy credit for far too long. I have nothing against 'elitist' products as you say, giving higher interest but having to pay high penalty fees, if it is balanced with accounts that offer low penalty fees.

At the end of the day, the banks can bounce cheques and do that, instead of charging someone £30 for paying a cheque of say, £10. It can all be automated.

When I was a student and had no credit offered, £0 in the account meant just that. I couldn't withdraw more, I couldn't get charged more. It just meant I had to be very careful with my finances, which I did and got by perfectly fine.

The fact that banks 'let' people withdraw more than what they have, means exactly that! They can set a limit on the account. They allow people to accidentally go over because they want to charge.

I am normally very good with my money. However, I have gone over my limit before only because the balance on my account was not 'in real time'. When I checked the balance, it was fine. This was misleading because A&L had not shown the payments taken out that day. They only updated it at the end of the day, which of course was too late by then. When I check my balance, I want to know what I've got there at that moment, before I withdraw.

Why do they show the balance at the end of the day, when they take any payments out in the early hours of the day itself?

ltlmiles5

LondonDiva wrote:

Nobody 'lets' anyone get overdrawn.


I would disagree with that. A limit can be placed on any account. The whole emphasis should be on knowing what you've got in your account, how much more has got to go out, and effectively warning people before they go overdrawn. It can all be automated easily.

Either place limits on accounts after say, a £50 buffer zone, so they can't withdraw more. Or warn them. The screen could inform others 'You are about to go over your limit. Do you wish to proceed? A charge of £.... will be imposed'.

Rather than allowing access to money and charging heftily for a few extra pounds gone overdrawn.

IvanOpinion

Just a thought .. is it possible that in trying to make our lives easier that debit cards could be a source of the problem? Most people use these in favour of cheques these days but at leats when one used cheques you would work out a running balance on the stub and would know (roughly) how much you had .. whereas with debit cards people just spend with no idea of what their balance is?

If people are prone to going overdrawn then they should arrange a low cost authorised overdraft limit for themselves .. most accounts will provide this service free of charge (my current bank keeps upping my authorised overdraft and I have never used it once).

Ivan

Becles

ltlmiles5 wrote:

The fact that banks 'let' people withdraw more than what they have, means exactly that! They can set a limit on the account. They allow people to accidentally go over because they want to charge.

The problem with that is, if they set a limit and refuse, people will complain about embarrassement in shops when the cards no longer work as they are up to their limit.

Imagine if you had a trolley load of shopping at the till at Sainsburys and the card was declined and you had no other way of paying for it.

This happened to me years ago when I was given my first payslip for a new job and assumed there was money in my account, but the company had forgotten to actually transfer the money into the account so there were no funds in it. It was highly embarrassing at the checkouts, especially when they took all my groceries off me in front of everyone

The account I use now has a free overdraft as a buffer zone, given to me because I've run the account in a responsible way. This will cover me for the odd mistake, should I make one. If banks cut charges then bring out inferior products to keep their profits, it's unfair on people like me who have managed to run the account properly.

Many accounts these days can be run by internet, telephone and interactive TV, as well as getting balances and mini statements from ATM's. There is no excuse for not being able to keep track of exactly what is in your account, other than laziness.

ltlmiles5

I don't think debit cards themselves are an issue. They are definitely a lot better than credit cards. Some people probably have no idea how much they have and keep withdrawing as much as they can. However, others would probably have a rough estimate and get overdrawn accidentally by just a few pounds.

It's the combination of direct debits, cheques, credit card payments. All going out on diferent dates, and the length of time cheques take to clear in your account. Managing your finances has definitely got a lot more difficult, and is so for many people.

Many people from the older generation used to withdraw money and pay bills themselves in person, therefore they knew just how much they had. However, going back to that system is not feasible in this day and age of busy lives and increased bill payments for all sorts of things. The queues would be far too long just to pay bills. And that is not a productive way of spending time.

Clearer information on our accounts is what we need. At the end of the day, it's all to do with computers. It can be automated and it should. It should be made clearer to help everyone keep on track with their finances. It is in everyone's interests.

Astaroth

If they bounce your cheque though there are 2 issues - one there is the potential for you to be charged with fraud (no intent to pay) if you wrote the cheque knowing there were insufficient funds in your account and two the person who has banked your cheque then gets billed for the bounce rather than you. Why should the person depositing the cheque be out of pocket for your inability to run your finances properly?

Prehaps people who have so much trouble handling their own money should return to the old fashioned way of using cash and have a basic account that gives them no option of going overdrawn as they dont get a switch/ cheque guarantee card? That way if they run out of money 1/2 way through the month they can just deal with not being able to buy food rather than knowingly taking unauthorised borrowing and then moaning about the charges afterwards?

As others have pointed out, banks are there to make profit. Charges on cards/ accounts makes a very small percentage of the average banks income/ profit but being realistic are banks going to want to see their profits go down by even the smallest amount? So yes, you can be irresponsible and cause penalty fees (you will see them set out right next to your signature agreeing to abide by them) to be charged and then say that you dont agree to the charges (remember the ones with your signature next to them saying you agree to them) and claim them back. For the rest of us this will mean higher interest on credit/ lower interest on savings/ lower "interductory" offers/ people who are currently borderline for credit who are currently being accepted then being rejected. I am sure that you will however be happy knowing that you have got out of your responsibilities again though,

To the OP - I am shocked that you are suprised that they are closing your account. You signed a piece of paper saying that you agree to their T&Cs (and there are options of other banks or other types of accounts that dont incure charges because you cant go overdrawn etc) and then try to get out of them - would you want to having anything to do with someone with such low moral fibre?

ltlmiles5

Astaroth wrote:

If they bounce your cheque though there are 2 issues - one there is the potential for you to be charged with fraud (no intent to pay) if you wrote the cheque knowing there were insufficient funds in your account and two the person who has banked your cheque then gets billed for the bounce rather than you. Why should the person depositing the cheque be out of pocket for your inability to run your finances properly?


There's no easy answer, is there? I wasn't aware that a bounced cheque means the person who banks it gets charged. I always thought that the person who has failed to pay up gets charged.

Perhaps a lower cheque guarantee amount should be introduced by the bank then for people with overdraft problems.