Bank Charges - Banks Win!

Eyeballs_2

Milarky wrote: »

If you think about it, the 'reality' of the present situation is that there is MASSIVE cross-subsidy used in banking to attract and retain customers (so-called 'competition'). 'Bank charges' are another arm of that reality.Yet banking has become even more concetrated of late with these crisis mergers.

In an ideal world there would be no cross-subsidy and bank charges would have no profit element - merely reflect the true cost of a bounced cheque here, or returned direct debt there, or covering an small unauthorised withrawal by a customer. Payments if not a 'right' are at least akin to other utility functions like water, electricity and gas - so why should they be so much less regulated in the public interest than those others? Profit has its place (in directing investment rationally) but profit much also 'know' its place in key areas like payments services.

Take savings accounts. How much does the interest (of 0.1%) paid on 'liquid-gold' type accounts get justified other than in terms of cross-subsidising internet accounts and other sources of 'hot money'? This is is one area where action against bankers is justified; pay depositors something much closer to the average rate on all accounts even if dedicated savings-nuts don't like it.

Back to bank charges; if the OFT had been 'victorious' in today's court case they would surely have made rules that forced banks to effectively eliminate cross-subsidy practices and only allow for a margin of profit much smaller than now. As it is, 'competition' will have to sort out the somewhat chaotic 'free-for-all' their Lordships have bequeathed us (This decision may have been right but no one really believes it was 'helpful')

So my point is to press for proper bank regulation in law - changing the law if necessary to

1) largely eliminate cross-subsidies in banking, saving and mortgages

2) have much more similarly priced products than now

3) find some way to stimulate competition (possibly revisit Cruickshank - which GB ignored in respect of state control of payments system) and removing barriers to entry

nice post, credit given

never-in-doubt

dpassmore wrote: »

I also do not like banks, but I don't get irrational and neurotic over them and I don't respond to rational postings in a frenzied manner.

No, you don't understand - I really do not like banks! Look at my past posts! :rotfl: :rotfl:

dpassmore wrote: »

As my earlier post implied, it can eat you up and muddle your mind - it would seem that has already occurred.

Not at all, I am debt free (apart from mortgage) but actively fight the banks, dca's and cra's and will continue to do so...... to be honest the banks have just proved yet again that they can do what they want and it puts our own OFT to shame - its a joke. If that is eating me up then fine, I am extremely bitter about this judegement and physically sick. It makes my goddam blood boil - so yea, you hit the nail on the head with that one!

Oh, think you'll find it's called 'passion'.....

dpassmore wrote: »

As someone has correctly pointed out earlier in this thread, you seem to have issues!

Did you see who said that though? His POV really doesn't concern me thus I never even gave him the time of day with a response..... he's as much use to the forum as a Snail on Skii's....

oxenryd

Gareth56 wrote: »

I'm old enough to remember when banks had managers and qualified bank staff rather than the glorified checkout assistants who are just there to sell different financial products today. If you needed any help or assistance with your account you just went into the bank and either spoke to the manager or the deputy bank manager and that was it unlike today when you have to speak to someone thousands of miles away just to organise an overdraft.
.

I'm not old enough to remember this, so here is my question: What was the manager/qualified bank staff able to do for you then ?

izools

I for one don't mind this decision atall.

I've always been infurated by people that think they have a right to run an account poorly.

I've been through serious financial difficulties in the past, I've been made redundant, had my house reposessed, and ended up bankrupt. Throughout all of this I never incurred a penny in charges from any bank account.

I've never been able to understand people wanting to claim back charges. If you know you can't afford something, you don't pay it, right? If I knew money was tight at any point and there was an upcoming DD due to leave, I would cancel the DD with the bank, apologise to the company concerned, and revise my spending / budget to ensure that the same thing didn't happen again.

I didn't stand idly by, gawking like a bloody muppet at my bank balance watching slack-jawed whilst transactions leave the account and then wonder why my bank charged me. It is this kind of account conduct befitting the type of ignoramus that should only every be permitted to operate a cash card account.

And for those that may accuse me of being high and mighty - I for one consider myself to be one of said ignoramouses, despite never having incurred a penny in bank charges, because of my prior history with credit cards and loans, and now personally opt to use a cash card account rather than a fully fledged current account purely because that is how I like to run my money.

If I need to make a large purchase, I use money I already have. If I can't afford something non essential, I don't buy it. If I need something essential and don't have the money, I sersiously consider how essential that item is, and normally don't buy it. Occasionally things get put on my credit card and if that happens I give myself a stern bollocking for not managing my money properly, followed by a further revision to my budget factoring in whatever that expense may have been.

Why other people can't be the same is beyond me. It isn't hard!!!

EDIT: To quote myself today, when I was in Barclays with my other half (he is leaving Lloyds TSB) the personal banker checked my accuont conduct, noticed I have a barclaycard, and offered to upgrade my current account and give me a £250 interest free overdraft. I think it was an additions account or something like that.

Here is what I said:

No thank you, if I want to spend anyone's money, it will be mine, not yours

olly300

Lokolo wrote: »

2) I am on £15k. I manage to save £400-£500 a month from a takehome of £1,000. So don't give me that 'oh the poor can't save' carp.

I presume you are not a single working parent with young children, who became single either due to their husband walking out on them or to escape domestic abuse.

Lokolo wrote: »

3) They have choices to live. Have you not heard of a loan? Or authorised overdraft?

Are you also aware that not everyone is eligible to get a loan or an authorised overdraft due to their circumstances?

You need to get real. Just because you and I are able to get these things and save there are people out there who can't for one reason or another.

Every time you post you presume that everyone lives in exactly the same circumstances as you and has had exactly the same life chances.

olly300

oxenryd wrote: »

I'm not old enough to remember this, so here is my question: What was the manager/qualified bank staff able to do for you then ?

They prevented people borrowing irresponsibility.

So if you asked for an overdraft the bank manager would ask you what it was for and look at your circumstances, and unless you met a certain criteria would say "No".

Chadsman

Lokolo wrote: »

Very very very few people start their working life in debt. So people can easily start their working life, for the first couple of years, start a savings account whereby you can save a lot of your salary incase circumstances do change.

I presume you are not a recent graduate.

olly300

Chadsman wrote: »

I presume you are not a recent graduate.

Lokolo has a degree but didn't get into debt.

chris_m

olly300 wrote: »

They prevented people borrowing irresponsibility.

So if you asked for an overdraft the bank manager would ask you what it was for and look at your circumstances, and unless you met a certain criteria would say "No".

And their decisions were based on their knowledge of you, your circumstances, your banking history, etc, rather than just "computer says yes".
They were also available and able to provide advice based, again, on their knowledge of you as a customer, not just an account number.

Joe_Bloggs

I feel guilty that my free banking is being subsidised by those who are in financial difficulty. The level of charges just perpetuates the initial financial difficulty further and thus pays for even more free banking.
The OFT tried and the banks stretched out the case, year after year, until they got what they wanted.
J_B.