Why do banks allow unauthorised overdrafts anyway?

dlk

fuzzybear01 wrote: »

I found that they wouldn't pay a £30 DD on one occasion, but did allow a £500 fraudulent card payment go through when I had no money in my account. When I asked why, they said it was to save their customers being embarrassed at the till! Rubbish!

That's absolute nonesense! The payment would hae declined unless you had funds available within your advised/unadvised limit. The payment would more than likey have been authorised when funds were available. Then other payments left your account bu once the authorisation is given the bank CANNOT go back on its original decision to pay the retailer.

dlk

Banks are not obligated to make their systems give you money that you don't have. Thats like leaving a wad of cash in the street and waiting for someone to take it before you fine them for theft, when you could just not leave it in the street in the first place.

Ah well...[/QUOTE]


Actually they are legally obliged in some cases. If you have so much as a penny available to spend and you got to an ATM to withdraw £10 it HAS to allow you to have the withdrawal because to refuse would mean refusing to give you your penny which they aren't allowed to do.

ganonman

dlk wrote: »

Actually they are legally obliged in some cases. If you have so much as a penny available to spend and you got to an ATM to withdraw £10 it HAS to allow you to have the withdrawal because to refuse would mean refusing to give you your penny which they aren't allowed to do.

I've never been able to take £10 out of an ATM unless I've had at least £10 in my account. You could go into a bank and withdraw your 1p and also buy something to the value of 1p with your card. The banks are not obligated by law to allow you to withdraw any money from an ATM, they could make you go to the branch every time if they wanted you to couldn't they?

If someone allows you to take something, it isn't theft. Even if it was, it would not be the banks right to fine you for commiting theft, they would have to get the police involved.

oldbill1969

Can I hijack this with my two pennethworth, I have an internet account with A&L, its a drip account for receiving funds from cashback sites etc. I do not have an overdraft in place as I don't need one on this accoun and no direct debits or standing orders go through this account.

I made a transfer payment to Betfair to place a bet for £10 and it went through.Two days later I received over £200 into the account. I don't regulary check this account as there is no need to for the above reasons. Last week I received a letter from A&L that I had alreadt accrued £80 in charges for going into unauthorised overdraft as they made the payment to Betfair when there was only £8.79 in the account this placed me into unathorised OD incurring £10 in fees but the £200 subsequently went in. from the beginning of November because there wasn't enough funds to cover the £10 in charges I was unaware of the accumalated upto the £80 mark.

My main bank account has never released funds when there was there is unsufficient and I believed that this was standard. Why did they make payment to Betfair when there was insufficient to make a transfer.

To make matter worse when I phone customer services to raise the issue I received a pack where they have stated that because I made the call they took it that I am in financial difficulty and they have gone onto search my credit files as a result to assess my claim for unfair charges. I only phoned them to review the circumstances.

To say I am hopping mad is an understatement.

simon_templar_2

You could ask why do account holders put themselves in a situation that makes them go over their agreed limits?

djm1972

willo65 wrote: »

If you have as an example a d/d for car insurance going out and will take you only £5 o/d would you prefer they bounce it and you are uninsured or as its only £5 pay it for you?

As it stands these days; this should never be an issue. Your insurance company will request the renewal payment before expiry; and if your account does not have sufficient funds the payment should be refused and your insurance company will contact you for an alternative means of payment.

djm1972

simon_templar wrote: »

You could ask why do account holders put themselves in a situation that makes them go over their agreed limits?

Thanks - but with respect that's irrelevant in terms of why banks are allowing something to happen that; as far as I can tell they have no reason to; no obligation to; the technology NOT to allow it to; and then charging you for it.

simon_templar_2

The buck stops with the account holder, it is not the job of the bank to control the account holders spending habits.

djm1972

simon_templar wrote: »

The buck stops with the account holder, it is not the job of the bank to control the account holders spending habits.

Thanks Simon, but I don't buy that. I'm thankfully not in the position that lots of people affected by this have found themselves in; but I think those that have deserve to understand this very fundamental point.

You are correct, it is not the bank's job to control their customer's spending habits; but that is absolutely no reason for them to let an account go overdrawn beyond any agreed limit when they have absolutely no reason to except perhaps for the opportunity to charge exuberant fees.

2_litre

simon_templar wrote: »

You could ask why do account holders put themselves in a situation that makes them go over their agreed limits?

Banks have allowed early payments to be paid on DD then charged the account holder even when it isnt there fault. How is that going over their agreed limits ?