Why Reclaim Bank Charges

Cleany

davidgmmafan wrote: »

"again nice try, but there is an unreasonable level."

What is this level and how is it determined?

I am not saying there should be no charges, merely that they should be proportionate. As I said earlier they need to be renamed, profit boosting levy, shafted customer fee, something along those lines.

I did not answer the question because it is clearly a loaded question.

Nobody is 'monitoring the banks profits' we're simply pointing out that the charges levied are much higher now (well relatively recently) than they were in the past and the work involved has diminished greatly. Again NO OBJECTION to charges being levid but in calling them admin fees or similar the banks hid the true nature of the charges.

the question isnt "what is the level", but "who has the authority to question it and why", and for me, those people incuring the charges, and those being involved in a campaign to reduce them, should certainly not have the authority to question it.

if the level of bank charges should be questioned then it should be done by a proper authority, and for a good reason.

however the reasons i hear on here currently are quite obviously and unreasonably biased, looking for some sort of revenge against "the bankers", wanting to blame someone else for their own financial mismanagement, or the basic assumption that greed and mindless profiteering should be the job of the consumer, not the businessman.

the chance for an authority to question these charges has been thrown out of the supreme court, and i believe for good reason.

as for the charges themselves, as the court decided, these form a part of the price of the account.

and incidentally, while looking for this thread, i happened upon a few posts with people looking for advice on how to claim - and frankly im amazed at the audacity of some of these posts. "oh my girlfriends student account went under by 10 quid and now theyre being charged £100". its not good enough that you're getting a very low interest loan and been provided with a sound upbringing and education compared to most people. all you have to do is take a bit of care with your cash but its never good enough. its moan moan moan, me me me.

these are not the people that should be questioning fiscal policy

davidgmmafan wrote: »

"from my perspective all i need to know is that they are too much. £10, £100 its money down the drain for nothing.

unless i neeed to go over my agreed limits for some reason, then i will factor in the cost of doing so, and therefore need to know the charges.

i think that the "inadvertantly incurred" charges that you talk of arent really so inadvertant in many cases, most certainly the second time round."

Oh Jesus I'm losing the will here. Firstly you need to consider for a moment there are people in different circumstances to your own. People for whom one charge can start an unstoppable spiral. At the very least you must concede those people, in this circumstances, get a very poor deal.

But you hold they are not the majority, that most people incur hefty charges deliberately? Erm run that by me again? People Like charges? They like wasting money?

firstly let me say, as i have many times, that there are a lot of cases where people should have there charges revoked because of their particular situation, and it is the failure of this campaign to lump those in with the majority of what i see moneygrabbing claimers who you wont hear from on these forums because they dont care.

back to the issue, the question we are both facing here is that of responsiblilty. deliberately or not, if you go over your credit limit there are charges, its your responsibility to make sure you stay in your limit. if, for whatever reason (well come to that later) you go out of your limit there are charges.

you may find it exasperating that i dont subscribe to your point of view. can i ask you to imagine how insane it must seem to some people that people cannot grasp the concept of responsibility, which is what being a grown-up is all about.

if you go over your credit limit then there are consequences. maybe youre right and its simply some small admin cost, maybe im right and the implications stretch further than that costing the bank in increased risk and some sort of deterrant needs to be factored in.

but that fact is that you cant just wipe it away as a mistake and oh it doesnt matter. debt and financial risk costs money, and someone has to pay that.

and going back to the reasons for going over limits, ive read some of them on here and theyre pathetic. the only time ive heard of a case that actually deserves some sympathy is third hand, because someone has heard of someone whos partner dies or was hospitalised etc. ive read quite a few appeals, and none of them are like that.

davidgmmafan wrote: »

"and thats the way it should be. going over agreed credit limits costs money, you would hardly expect the banks to pay for it would you?

oh of course maybe its too much? maybe theyre making "too much" money out of it?

how dare they win!"

Pay for what? Un unpaid DD or standing order where NOTHING happens, no money changes hands and there is no manual intervention, yeah the costs they bear must be immense. I believe it is too much, how much too much we don't know because they won't tell us, but this links into your earlier point that "there is an unreasonable level".

Of course businesses are there to make money, some choose to do it by having good products or services, and some do it by srewing people over. With regard to charges, for the most part, banks do the latter. I can only hope such business models fair badly in the long run (although I guess Rogue Traders, and Watchdog et all would dis-agree!).

why do you think its cheaper to pay by direct debit? what do you think happens with that guaranteed money? why do you think signing contracts for monthly payments is cheaper?

guaranteed money is worth more money than the original. thats the way it works. reliability is cheap. if you sign into a service thats cheap because its reliable, and are unreliable, then expect to be charged.

no banks dont make money by screwing people over. banks form an integral part of our society and have been helping people for hundreds of years. your knee-jerk anti-establishment argument has no substance or evidence to back it up. i totally agree with you that there are many people, managers etc in the banking trade in it purely for the money trying greedily to get as much money as they can for the sake of their career. its selfish and pathetic. but the banking system as a whole is there for a reason. dont just label the whole thing as rubbish simply because you have an axe to grind.

the reason im against this campaign is that instead of trying to eliminate some of this greed on the part of the bankers (well done obama by the way), all its doing is trying to get the customers a piece of the pie. wheres the call to responsbility and good conscience on the part of all parties? nowhere, its just moneygrabbing.

davidgmmafan wrote: »

"well i think its partly deterrant partly profit.

why should there be a bank account that doesnt incur charges (even though there may be one)? we live in a country where we have to manage your finances, just as we have to manage our emotions and other business. perhaps some people need to accept that the management of our finances are a part of our responsibilty and obligations to the rest of society?"

If its deterrent thier ultimate goal is to change behaviour, in which case there would be no revenue. If its profit then they are accepting the behaviour will not change.

And there should be such a bank account because you need to have an account even for benefits. If you open a basic bank account and say can I go overdrawn I honestly believe most bank staff would say no, but they would be wrong.

Not being experts in banking most people do not realize that the ONLY way to have an account which cannot go overdrawn is to have a savings account, and yes they do whtm with cards.

But then you can't have DD's, which attract hefty discounts, so either way the poo get screwed. Strange that.

if you cant pay on time you dont get the discount that dds return, simple as that. you dont like that, go find a parallel universe where you get something for nothing.

and ill say it again, people need to accept that the management of our finances are a part of our responsibilty and obligations to the rest of society.

davidgmmafan wrote: »

"if some company made an unauthorised direct debit from my bank account i would be as annoyed and frustrated as anyone else, probably more to be honest."

It happens all the time, and the direct debit guarantee in some instances is a complete joke, but that's a whole other issue

yes agreed. big business is a horrible machine that pays little attention to the individual.

davidgmmafan wrote: »

"1. i dont remember the banks lecturing the public on fiscal responsibility"

I don't have a source but I'm sure there would be examples of that floating around. You know people like Angela Knight who live in a bubble and can't imagine circumstances different to thier own. On the day of the ruling she said "most customers do not incur charges", and there has always a kind of moral issue to all of this.

Hopefully someone has a handy source to post, I really can't be bothered to look.

I wouldn't mind so much about the banks being so badly acqutined with the truth if they'd been honest from the outset. Did they say yeah we make loads from these charges? No they said oh well we incur costs you see blah blah blah. At every stage when thier lies were exposed they still never admitted any wrongdoing.

Even Natwest which I believe had the biggest reduction in charges (from £38 to £5 for an unpaid item I believe), hasn't made any kind of admission that the previous charges were extracting the urine. I'd say you can infer it from thier actions but that's not quite the same thing.

And what's happening now, Halifax claims to charge 0% APR when, if the APR were calculated it can be several thousand per cent under their new charging regime. This is what banks are like, and the more people that know that the better.

this is what businesses are like. unfortunately the same mindless greed is causing thousands to jump on the back of this campaign for some quick cash they dont deserve, so all its doing is trying to beat the banks at their own game. i wish you could see that.

davidgmmafan wrote: »

"how is it that on the one hand the general public are being touted as morons who cant manage their affairs and need the banks help, yet at the same time are the pillars of wisdom in determining how banking charges should work? theres an inconsistancy there that speaks volumes."

I never said they were morons, I was merely stating that a bank, indeed any business, has no interest in letting customer build up debts they cannot repay. The current system does that in spades.

but they can repay it and in most cases they do. anyway why is is the banks responsibility for "letting" customers build up debts they cant repay?

someone who gets into debt and cant repay it, and then blames the bank, is a moron in my book.

davidgmmafan wrote: »

Furthermore surely those who have experience of charges are best placed to advise banks, the government, or whomever what it is like.

They may even ALSO have experience of complaining to the bank about anything and finding out they are very good at writing replies which do nothing to address the points which were made.

i doubt those with an axe to grind against the banks are really the best people to take an objective look at the situation.

davidgmmafan wrote: »

Since we're asking loaded questions here's one for you

hehe

davidgmmafan wrote: »

How is it that, in a supposedly competitive market, there was almost uniformity in the level of the charges?

I can think of two reasons , one of which the OFT is concerned about. People dont' switch, for whatever reason and therefore that stops true competition. Secondly there is a cartel, what's the point of switching when they are all the same? I know these two points are very close together but they are not quite the same.

It was never about full refunds, the law which was being used initially was seen as a mechanism to get the banks to disclose thier costs. This has been done in a limited fashion through the OFT, but the banks definately did not want this info to come out.

And as for people who did get full refunds you can't just look at the issue of charges in isolation. You have to throw in all the issues around how crap the DD guarantee is, how crap banks are at handling complaints (its about feel good not do good), and the general feeling that these banks are too big (certainly too big to fail) and can pretty much do what they want.

i agree, the uniform level of charges doesnt reflect the fact that its a competitive market. although it could be said that the market has found the lowest price, personally i doubt it.

however if you look at markets in general, you will find evidence of "cartels" because of the sispicious levels of pricing. my personal opinion is that some companies are quite certainly operating cartels and it should be sorted out, but not always. its usual for companies to purposely not challence other companies on price as they know what will happen, all prices and all profits will go down. so they challence on other criteria, such as service or added value.

theres also the possiblity that these charges are subsidising other accounts. but before you collapse in a heap of injustice, i dont think theres anything wrong with that. in fact its quite normal for there to be different prices for the same product, or hugely different prices for different versions of the same product. for example do you think the price of a first class plane ticket actually reflects the cost? of course it doesnt.

however i digress. perhaps the charges could be a little lower, i dont know. but thats beside the point. what is the point as far as im concerned is that the campaign is being run against all bank charges on behalf of those that incur them. i and many others believe quite strongly that bank charges are quite reasonable as the vast majority of those incuring them are doing so because they are simply not taking the time and effort to manage their finances. it is these people that have benefited from this campaign the most so far, and thats wrong. it sends the message that you can have a half-arsed attitude and someone slse will pick up the cost, and above all, these people should not be having any sort of say in the rights and wrongs of any financial situation, as they have clearly demonstrated a lack of respect for their own finances, and the financial system as a whole. they have defaulted on their own responsibilities, they should have nothing to say about anyone elses.

Chrysalis wrote: »

Cleany what is so bad about simply blocking all payments where there is no funds and doing it automatically without a fee? what is the problem with it?

i dont have a problem with such a thing existing. but it apparently it doesnt exist. some say that it doesnt exist on purpose so "the banks" can make money, i disagree.

there is always going to be a cost for financial mismanagement. the question is where does the buck stop. at the moment it stops with bank charges. change them and the charges or some other penalty will appear somewhere else.

direct debits is a good example. people have bewilderingly argued that not paying a dd costs nobody anything, without thinking to ask why its cheaper in the first place. not paying dds costs because you are defaulting on a financial contract, that contract keeps the price down, and the charges keeps the price down for those who stick to their agreements, and so it should.

get rid of the banks non dd payment charges and what do you think will happen? those people who default will have it on their record and they will simply not be allowed to use dds, and be stuck with permanently higher costs. in the short term no charges, but in the longer term higher bills. (sounds a bit like hp, cough cough)

the problem i have is that to ask for such an account is totally selfish, its ignorant of the financial responsbility we have for others, and its asking to have your cake and eat it. nobody is forcing anyone to go to the shops, or to sign up to direct debits.

people seem to have conned themselves into thinking that these things dont exist because the banks are out to screw us all, and therefore on the side of justice. well people believe what they want to, and they will go all round the houses and up and down and ask for anything rather than face their own responsibilities.

davidgmmafan

Because we keep going over the same ground in different ways.

Ill state where I dis-agree and why as simply as I can. You seem to go from if you go over the limit there is a charge (which I totally agree with) to and that charge can be whatever the banks wants. That is a huge leap.

And yet you do agree there is some level at which a charge would be too high. Clearly a million is too high, I'd say that level was £5 or £10.

"the question isnt "what is the level", but "who has the authority to question it and why", and for me, those people incuring the charges, and those being involved in a campaign to reduce them, should certainly not have the authority to question it.

if the level of bank charges should be questioned then it should be done by a proper authority, and for a good reason."

And therein lies the problem, the OFT don't, and in case it had excaped your attention most of the regulatory bodies in this country are a complete joke. I would also add that massive amounts of complaints could and indeed should prompt the attention of a regulator. How else would it come to thier attention? The company benefitting is not going to tell them.

DD's are cheaper for the company, and if they are not paid and they charge you then that's quit different. Incidentally if a DD is returned twice NPower charge £6, a lot different to a bank charge. But why not just let the customer have the embarrassment of that or a missed mortgage payment?

I recall a message on CAG where a customer had been charged for a returned direct debit by the originator as well as the bank. He asked the bank for some info, any info, as to the costs and how they were spread between the bank and companies that use the DD scheme since they were both charging an admin fee. As far as I am aware no meaningful answer was recieved.

And then there's the issue of paid item fees, the customer has no idea what the decision making process is to decide if a payment is paid (and a paid item fee levied) or returned (and a returned item fee is levied). So the customer is expected to consent to a charge when they have no udnerstanding or control of the process. This is particularly relevent when one is more than the other.

I agree that the campagin has been to successful in that I believe the full refunds banks were giving to all and sundry was a mistake, but there again if they hadn't kept increasing the charges it wouldn't have come to that would it? If they hadn't chosen to not defend almost all claims it wouldn't have come to that.


"Cleany what is so bad about simply blocking all payments where there is no funds and doing it automatically without a fee? what is the problem with it?
i dont have a problem with such a thing existing. but it apparently it doesnt exist. some say that it doesnt exist on purpose so "the banks" can make money, i disagree.

there is always going to be a cost for financial mismanagement. the question is where does the buck stop. at the moment it stops with bank charges. change them and the charges or some other penalty will appear somewhere else."

They do have such accounts in other countries I believe, some say international comparisons are irrelevent but I do not agree. It gives a valuable insight into the alternatives.

I can't find the bit I was going to quote now, but you say banks don't make money from screwing people over. Having worked in a Building Society that wants to be like the banks I respectfully disagree. They are all under such pressure they'll do things like sell buildings insurance to someone who is renting, or sell home insurance to someone who is struggling to pay back an overdraft. And these are just the things I know about!

Bank accounts are almost an essential (how else would I be paid) and it is precisely that fact which means they should be carefully controlled.

I guess what it comes down to is this you seem to blame customer for everything and I'll admit I'm biased the other way with regard to the banks. The truth is probably somewhere in the middle.

davidgmmafan

"theres also the possiblity that these charges are subsidising other accounts. but before you collapse in a heap of injustice, i dont think theres anything wrong with that. in fact its quite normal for there to be different prices for the same product, or hugely different prices for different versions of the same product. for example do you think the price of a first class plane ticket actually reflects the cost? of course it doesnt."

I don't expect the cost of a first class ticket to reflect the costs directly as there's profit in there. But clearly there is some relationship. You know its going to be more than economy and you have a choice. You know you'll get certain perks, and you know the company has calculated the costs and added something on for themselves. You can see the price clearly. Last time I checked you don't need a first class ticket to recieve your pay.

The travel company doesn't charge you for the consideration of whether or not the flight will actually take off... and so on and so on. It is very difficult to give examples which are useful since bank accounts are pretty much essential.

The admin fee charged for some companies does not, I believe reflect the cost, and even if it does that's what the price is for. I have no objection to a business making a profit, even a massive one, its the cloak and dagger stuff I don't like.

They call it an admin fee because they know it'll cause less fuss, but its an outright lie.

Alpine_Star

Quote:
Originally Posted by Chrysalis
Cleany what is so bad about simply blocking all payments where there is no funds and doing it automatically without a fee? what is the problem with it?

Cleany wrote: »

i dont have a problem with such a thing existing. but it apparently it doesnt exist. some say that it doesnt exist on purpose so "the banks" can make money, i disagree.
.

You are quite wrong. It now exists in the United States for certain types of payment instruction. http://www.federalreserve.gov/newsevents/press/bcreg/bcreg20091112a1.pdf
http://www.creditcards.com/credit-card-news/opt-in-fed-debit-card-overdraft-fee-rules-1271.php

In the UK the entire issue of bank charges is predicated on the notion that a payment instruction issued where funds are not available is automatically deemed as an 'informal' request for an overdraft and contrary to what you believe. the associated charge is for the service of 'consideration' of that request - this is how it stands in law. There is no option to decline or opt out of this extremely expensive service and as such is forced upon the consumer whether they want that service or not.

Chrysalis

Cleany wrote: »

i dont have a problem with such a thing existing. but it apparently it doesnt exist. some say that it doesnt exist on purpose so "the banks" can make money, i disagree.

there is always going to be a cost for financial mismanagement. the question is where does the buck stop. at the moment it stops with bank charges. change them and the charges or some other penalty will appear somewhere else.

direct debits is a good example. people have bewilderingly argued that not paying a dd costs nobody anything, without thinking to ask why its cheaper in the first place. not paying dds costs because you are defaulting on a financial contract, that contract keeps the price down, and the charges keeps the price down for those who stick to their agreements, and so it should.

get rid of the banks non dd payment charges and what do you think will happen? those people who default will have it on their record and they will simply not be allowed to use dds, and be stuck with permanently higher costs. in the short term no charges, but in the longer term higher bills. (sounds a bit like hp, cough cough)

the problem i have is that to ask for such an account is totally selfish, its ignorant of the financial responsbility we have for others, and its asking to have your cake and eat it. nobody is forcing anyone to go to the shops, or to sign up to direct debits.

people seem to have conned themselves into thinking that these things dont exist because the banks are out to screw us all, and therefore on the side of justice. well people believe what they want to, and they will go all round the houses and up and down and ask for anything rather than face their own responsibilities.

I have no problem with people been banned from using direct debits, personally I avoid using direct debits as much as possible, for example I have paid over the phone or online manually for many years for my gas and electric. I also pay my credit card manually.

If a dd doesnt get paid the consequences are the same regardless in terms of defaulted bills, the only difference is the banks either can or dont make money out of it, in fact the costs are actually higher to the recipient's of the direct debits since the defaulter goes from just owing them money to them also owing the bank money for a returned item fee. As a result the debtor is now less likely to pay the original debt.

the banks can choose to make a profit this way, my complaint is lets have some honesty about it, they not doing anyone any favours other than their shareholders.

davidgmmafan

In relation to direct debits when I read about being banned from using them a thought occurred to me. It is also worth noting that you CANNOT opt out of direct debits. You can obviously choose not to give companies your bank details, but if any company inadvertantly puts in the wrong details the money WILL come out of the account.

Then you have to approach the bank under the guarantee and the knowledge staff have about this varies greatly. Please not I personally heard a branch manager in his fifties telling a customer who had no dealings with a particular company that he'd have to speak to the company directly.

This is non-sense but at the time I did now know what I know now, I educated myself about the DD guarantee as it was NOT covered in training.

Cleany

davidgmmafan wrote: »

Because we keep going over the same ground in different ways.

Ill state where I dis-agree and why as simply as I can. You seem to go from if you go over the limit there is a charge (which I totally agree with) to and that charge can be whatever the banks wants. That is a huge leap.

And yet you do agree there is some level at which a charge would be too high. Clearly a million is too high, I'd say that level was £5 or £10.

my point is that its up to the bank to set their charges not us. i accept that if they all have the same charges so theres no choice and those charges are too high then thats wrong. but i dont think theyre too high nor does the supreme court etc.

nor is it up to disgruntled customers who have, in the first place, gone beyond their agreed credit limit, and then criticised the charges.

it is right to let the correct people decide, and they have.

davidgmmafan wrote: »

"the question isnt "what is the level", but "who has the authority to question it and why", and for me, those people incuring the charges, and those being involved in a campaign to reduce them, should certainly not have the authority to question it.

if the level of bank charges should be questioned then it should be done by a proper authority, and for a good reason."

And therein lies the problem, the OFT don't, and in case it had excaped your attention most of the regulatory bodies in this country are a complete joke. I would also add that massive amounts of complaints could and indeed should prompt the attention of a regulator. How else would it come to thier attention? The company benefitting is not going to tell them.

yep regulatory bodies are a bit pants, i agree. but complaints from people who have only something to complain about because they defaulted on their agreements in the first place carry little weight with me.

davidgmmafan wrote: »

DD's are cheaper for the company, and if they are not paid and they charge you then that's quit different. Incidentally if a DD is returned twice NPower charge £6, a lot different to a bank charge. But why not just let the customer have the embarrassment of that or a missed mortgage payment?

im not going over what i have said about direct debits again. i dont make the rules its not up to me and nobody has to use direct debits. if you cant make the payments dont use it.

davidgmmafan wrote: »

I recall a message on CAG where a customer had been charged for a returned direct debit by the originator as well as the bank. He asked the bank for some info, any info, as to the costs and how they were spread between the bank and companies that use the DD scheme since they were both charging an admin fee. As far as I am aware no meaningful answer was recieved.

And then there's the issue of paid item fees, the customer has no idea what the decision making process is to decide if a payment is paid (and a paid item fee levied) or returned (and a returned item fee is levied). So the customer is expected to consent to a charge when they have no udnerstanding or control of the process. This is particularly relevent when one is more than the other.

people pay stuff all the time without understanding the costs. there may well be something bad going on in your examples, but i dont see that a good reason to alter all bank charges.

davidgmmafan wrote: »

I agree that the campagin has been to successful in that I believe the full refunds banks were giving to all and sundry was a mistake, but there again if they hadn't kept increasing the charges it wouldn't have come to that would it? If they hadn't chosen to not defend almost all claims it wouldn't have come to that.

youre looking at it the wrong way. you seem to see some sort of battle against the banks. but its a battle that cant be won.

even if the bank charges were capped at £5 most people would go over their limits even more because they would incur less charges or be banned from using certain types of accounts, then there would be a campaign against that.

if you want money there are plenty of better ways for a person or group of people to do it than to attemp to stop some perceived greediness on the part of a group of people who's money you're dependant upon.

davidgmmafan wrote: »

"Cleany what is so bad about simply blocking all payments where there is no funds and doing it automatically without a fee? what is the problem with it?
i dont have a problem with such a thing existing. but it apparently it doesnt exist. some say that it doesnt exist on purpose so "the banks" can make money, i disagree.

there is always going to be a cost for financial mismanagement. the question is where does the buck stop. at the moment it stops with bank charges. change them and the charges or some other penalty will appear somewhere else."

They do have such accounts in other countries I believe, some say international comparisons are irrelevent but I do not agree. It gives a valuable insight into the alternatives.

maybe they do, thats great for them. but you will also find in other countries different attitudes to consumerism, debt and even eating. you do know how credit/consumption hungry we are in this country dont you?

davidgmmafan wrote: »

I can't find the bit I was going to quote now, but you say banks don't make money from screwing people over. Having worked in a Building Society that wants to be like the banks I respectfully disagree. They are all under such pressure they'll do things like sell buildings insurance to someone who is renting, or sell home insurance to someone who is struggling to pay back an overdraft. And these are just the things I know about!

yes of course they do, they're selfish, and so are the people who think theyve been wrong by being charges even though they've gone over their agreed credit limits. the world is full of selfish people.

i dont like the pretence that its the bad bankers against the good consumers, thats a load of rubbish. if one bunch of selfish people who want more money want to take on another load of selfish people who want more money, and who have more money and experience, theyre going to lose. this is my point, youre fighting the wrong battle. its bad against bad.

davidgmmafan wrote: »

Bank accounts are almost an essential (how else would I be paid) and it is precisely that fact which means they should be carefully controlled.

they are, its just that some people seem to think those controls shouldnt apply to them.

davidgmmafan wrote: »

I guess what it comes down to is this you seem to blame customer for everything and I'll admit I'm biased the other way with regard to the banks. The truth is probably somewhere in the middle.

my opinion is that the responsibility for managing an individuals finances lies with that individual. its their money isnt it?

davidgmmafan wrote: »

"theres also the possiblity that these charges are subsidising other accounts. but before you collapse in a heap of injustice, i dont think theres anything wrong with that. in fact its quite normal for there to be different prices for the same product, or hugely different prices for different versions of the same product. for example do you think the price of a first class plane ticket actually reflects the cost? of course it doesnt."

I don't expect the cost of a first class ticket to reflect the costs directly as there's profit in there. But clearly there is some relationship. You know its going to be more than economy and you have a choice. You know you'll get certain perks, and you know the company has calculated the costs and added something on for themselves. You can see the price clearly. Last time I checked you don't need a first class ticket to recieve your pay.

The travel company doesn't charge you for the consideration of whether or not the flight will actually take off... and so on and so on. It is very difficult to give examples which are useful since bank accounts are pretty much essential.

The admin fee charged for some companies does not, I believe reflect the cost, and even if it does that's what the price is for. I have no objection to a business making a profit, even a massive one, its the cloak and dagger stuff I don't like.

They call it an admin fee because they know it'll cause less fuss, but its an outright lie.

yes theres a lot of that going on, making bad things sound good etc. i dont like it either and i give it a name thats something to do with a male cow and the end result of the digestive process.

personally id like them to be called "dont take the mickey its real money you know" charges, but that would just be patronising.

anyway the world is full of this stuff. why just the other day i read that someone got into debt and couldnt pay it back, but apparently it was someone elses fault. unbelievable!

davidgmmafan wrote: »

In relation to direct debits when I read about being banned from using them a thought occurred to me. It is also worth noting that you CANNOT opt out of direct debits. You can obviously choose not to give companies your bank details, but if any company inadvertantly puts in the wrong details the money WILL come out of the account.

Then you have to approach the bank under the guarantee and the knowledge staff have about this varies greatly. Please not I personally heard a branch manager in his fifties telling a customer who had no dealings with a particular company that he'd have to speak to the company directly.

This is non-sense but at the time I did now know what I know now, I educated myself about the DD guarantee as it was NOT covered in training.

yes of course that can happen but thats got nothing to do with this subject. its possible for accidents to happen and the wrong people be charged, or you could lose a 50 pound note tomorrow. its also possible for someone to steal any personal information and use it illegally. were not talking about accidents or stealing are we?

Alpine_Star wrote: »

Cleany what is so bad about simply blocking all payments where there is no funds and doing it automatically without a fee? what is the problem with it?

Cleany: "i dont have a problem with such a thing existing. but it apparently it doesnt exist. some say that it doesnt exist on purpose so "the banks" can make money, i disagree."

You are quite wrong. It now exists in the United States for certain types of payment instruction. http://www.federalreserve.gov/newsevents/press/bcreg/bcreg20091112a1.pdf
http://www.creditcards.com/credit-card-news/opt-in-fed-debit-card-overdraft-fee-rules-1271.php

In the UK the entire issue of bank charges is predicated on the notion that a payment instruction issued where funds are not available is automatically deemed as an 'informal' request for an overdraft and contrary to what you believe. the associated charge is for the service of 'consideration' of that request - this is how it stands in law. There is no option to decline or opt out of this extremely expensive service and as such is forced upon the consumer whether they want that service or not.

then how has it never happened to me or many other people?

Alpine_Star wrote: »

I have no problem with people been banned from using direct debits, personally I avoid using direct debits as much as possible, for example I have paid over the phone or online manually for many years for my gas and electric. I also pay my credit card manually.

fantastic. please tell other people!

Alpine_Star wrote: »

If a dd doesnt get paid the consequences are the same regardless in terms of defaulted bills, the only difference is the banks either can or dont make money out of it, in fact the costs are actually higher to the recipient's of the direct debits since the defaulter goes from just owing them money to them also owing the bank money for a returned item fee. As a result the debtor is now less likely to pay the original debt.

i disagree with this. the direct debit system is cheap for millions of people for a reason. im not an expert in any sense, but i can clearly see that guaranteed payments save money in more ways than one. if irresponsible people are going to sign up and default on those payments and ruin it for everyone else they should be charged a lot of money.

if people cant make the payments they shouldnt sign up for it. nobody is making them, you yourself dont do it.

Alpine_Star wrote: »

the banks can choose to make a profit this way, my complaint is lets have some honesty about it, they not doing anyone any favours other than their shareholders.

honesty? you want honesty?

well lets start by admitting that the majority of cases of people incurring bank charges is because they didnt manage their finances properly, and are fully responsible for what happened.

once that's done we can go on from there.

davidgmmafan

"i accept that if they all have the same charges so theres no choice and those charges are too high then thats wrong. but i dont think theyre too high nor does the supreme court etc."

The SC was not ruling on that so lets not pretent it was ok? Its amazing to me that on the one hand you seem a whisper away from agreeing that there is a cartel in place and thus that the customers 'consent' is worthless, and on the other hand say its all the customers fault.

You are argue that if the charges are lower then people would go over their limit more, yet you state at some level the charges magically become unreasonable. A million is too much you say, but you don't say why. Would £100 be too much? £1000? £50? £38? £30?

I am on a crusade against banks in the sense that it offends me that they can lie so openly. They don't take customers complaints seriously, that's why the FOS is snowed under.

"yes of course they do, they're selfish, and so are the people who think theyve been wrong by being charges even though they've gone over their agreed credit limits. the world is full of selfish people."

Bit of a contradiction from your earlier stated banks do not make money from screwing people over.

i dont like the pretence that its the bad bankers against the good consumers, thats a load of rubbish. if one bunch of selfish people who want more money want to take on another load of selfish people who want more money, and who have more money and experience, theyre going to lose. this is my point, youre fighting the wrong battle. its bad against bad."

Maybe it is bad against bad, but given that one side has virtually unlimited resources I'll side with the underdog.

"incurring bank charges is because they didnt manage their finances properly, and are fully responsible for what happened."

Look I don't know if most people who incur charges were as you describe or not. In fact I don't know how you do, is there some secret report which contains this info. I do know of thousands of examples of people who, once they had incurred a charge got no help from the bank and one mistake started an unstoppable snowball of charges.

I agree, in the first instance, the customer causes the charge by accident. Yet you seem to judge a lot from that. You seem to assume that they in some way benefit from this, but I fail to see how. What benefit is there in being charged for a paid or an unpaid item? In both instances you are worse off.

I also agree that their should be charges. I reject part of what you are saying because, in your opinion rightly, the customer has no control over the charge. Natwest used to charge £12, recently it was up to £38, and there's nothing to stop them putting it higher. So the customers consent is open ended, and constrained by the lack of competition in the current account market.

I agree some people were greedy and claimed charges back as some kind of windfall, and that they have done great harm in the same way that people falsely claiming benefits take money that could've gone to help people in true need.

But I cannot accept that the status quo is fair. Even you accept that at some level the chartes become unacceptable. We differ as to where that level is.

I also don't follow why, if the charges are to deter people they generate £2.6 billion a year, but I doubt we can agree on that

Cleany

davidgmmafan wrote: »

"i accept that if they all have the same charges so theres no choice and those charges are too high then thats wrong. but i dont think theyre too high nor does the supreme court etc."

The SC was not ruling on that so lets not pretent it was ok? Its amazing to me that on the one hand you seem a whisper away from agreeing that there is a cartel in place and thus that the customers 'consent' is worthless, and on the other hand say its all the customers fault.

im not going to pretend that the banks are some holy and moral establishment. they push the limits of whats legal in order to make money. but all businesses do this.

the only difference in this case as i see it is that they are all charging around the same so you cant shop around.

isnt it possible that these charges are the actual cost of the financial instability that these unreliable customers cause? even if its not, so what if the banks want to make some percentage profit on these customers? they are running a business!

as far as the customers "fault" is concerned, it is up to them to stop spending beyond their limits, nobody else.

you seem to be muddling it all up, its quite clear:

its the responsibility of the bank to set their charges. its the responsibility of the customer to manage their finances.

it makes little sense to me for customers who cant manage their finances and arent living up to their responsibilities to be telling the banks or anyone else how to deal with their affairs.

davidgmmafan wrote: »

You are argue that if the charges are lower then people would go over their limit more, yet you state at some level the charges magically become unreasonable. A million is too much you say, but you don't say why. Would £100 be too much? £1000? £50? £38? £30?

you want me to actually tell you why a million pounds would be a silly charge for going overdrawn?

davidgmmafan wrote: »

I am on a crusade against banks in the sense that it offends me that they can lie so openly. They don't take customers complaints seriously, that's why the FOS is snowed under.

yes the banks are full of it, so are all businesses. and it offends me too, thats why im not a businessman.

but you want to make the banks a special case, that i dont agree with.

davidgmmafan wrote: »

"yes of course they do, they're selfish, and so are the people who think theyve been wrong by being charges even though they've gone over their agreed credit limits. the world is full of selfish people."

Bit of a contradiction from your earlier stated banks do not make money from screwing people over.

they do a bit, all businesses do. they'll take what they can, thats why its good that there are sites like this. but in the end we dont have to fall for it. theyre not doing anything illegal, theyre just on the blag. you dont have to buy something because you saw it on tv or some celeb is using it, and you dont have to pay by direct debit or take out a loan.

just as a little effort pays off financially when shopping around, so does it when managing your finances. cant be bothered to sort out your money? its gonna cost you, and it should. thats what this is about.

i get offers for loans and credit cards all the time. i dont need any credit. i might want this, or that, but i know i dont need it so i dont let them "screw me over".

even last week i was tempted to go for a credit card and follow the advice of using one and paying it all back regularly to improve your credit rating (not sure what mine is though), but then i read in the t&cs that it costs £3 for a statement etc, and i reasoned that i couldnt be bothered with all that and i dont need it.

dont play the credit game if you dont know what you're doing because you will lose, if the bank charges dont get you something else will.

davidgmmafan wrote: »

i dont like the pretence that its the bad bankers against the good consumers, thats a load of rubbish. if one bunch of selfish people who want more money want to take on another load of selfish people who want more money, and who have more money and experience, theyre going to lose. this is my point, youre fighting the wrong battle. its bad against bad."

Maybe it is bad against bad, but given that one side has virtually unlimited resources I'll side with the underdog.

hehe. you know if you win you'll be just like them.

davidgmmafan wrote: »

"incurring bank charges is because they didnt manage their finances properly, and are fully responsible for what happened."

Look I don't know if most people who incur charges were as you describe or not. In fact I don't know how you do, is there some secret report which contains this info. I do know of thousands of examples of people who, once they had incurred a charge got no help from the bank and one mistake started an unstoppable snowball of charges.

of course it's not unstoppable.

davidgmmafan wrote: »

I agree, in the first instance, the customer causes the charge by accident. Yet you seem to judge a lot from that. You seem to assume that they in some way benefit from this, but I fail to see how. What benefit is there in being charged for a paid or an unpaid item? In both instances you are worse off.

nobody benefits from financial instability. it costs. about £100 or so it seems.

davidgmmafan wrote: »

I also agree that their should be charges. I reject part of what you are saying because, in your opinion rightly, the customer has no control over the charge. Natwest used to charge £12, recently it was up to £38, and there's nothing to stop them putting it higher.

maybe its because they had to pay out so much because of the campaign lol

davidgmmafan wrote: »

So the customers consent is open ended, and constrained by the lack of competition in the current account market.

lets get the competition or the monopolies commision and get it sorted properly then. i would welcome that on more than a few fronts including supermarkets and oil companies.

but its not going to happen because the economy is driven by people spending and getting into credit and making it all possible. lots of those people will be susceptable to bank charges.

if lowering bank charges would make people stop and think and slow down the race towards consumer oblivion i would be all in favour. but it wouldnt, it would make it worse.

davidgmmafan wrote: »

I agree some people were greedy and claimed charges back as some kind of windfall, and that they have done great harm in the same way that people falsely claiming benefits take money that could've gone to help people in true need.

i understand that. i respect that you're coming from a balanced viewpoint :-)

davidgmmafan wrote: »

But I cannot accept that the status quo is fair. Even you accept that at some level the chartes become unacceptable. We differ as to where that level is.

yes i think thats a very clear and correct way of putting it.

davidgmmafan wrote: »

I also don't follow why, if the charges are to deter people they generate £2.6 billion a year, but I doubt we can agree on that

assuming they do generate that much and it is all profit (which ill accept for the sake of argument), then its a lot less than the banks make from loans and mortages etc. and there's nobody moaning about the charges on these (yet :P).

to be honest if you would have told me before i made this thread that you can get stung for around £100 for just an unpaid direct debit i would have been surprised and said that it was too much. however after thinking about how direct debits work, and reading the many cases on here of people simply wanting the money back for the sake of it, even though they are clearly responsible for going over their limits, i think the charges are about right.

ill ask you this. before people could claim their money back, what happened to them? were they made bankrupt? did they end up on the streets? no. in the vast majority of cases they paid it, absorbed the cost, and hopefully learned a lesson.

it seems like a big scrap over money to me that both sides could live without - but lets face it they want it!

davidgmmafan

Ok I'm typing this for the second time due to the annoying nature of these forums (sort it out MSE!).

First thing I picked out

"assuming they do generate that much and it is all profit (which ill accept for the sake of argument), then its a lot less than the banks make from loans and mortages etc. and there's nobody moaning about the charges on these (yet :P)."

I'm pretty sure that figure was given by the OFT and is widely quoted. Interesting that you mentioned mortgages and a day or two after the FSA fined some firms for not treating customers fairly. Amongst other things they were told they could not make a profit out of charges, which is EXACTLY the same complaint people have had over bank charges. Way to be consistent there (this is directed at the FSA not you, I'm not even sure if they have powers over current accounts but then they were involved in the waiver...).

"to be honest if you would have told me before i made this thread that you can get stung for around £100 for just an unpaid direct debit i would have been surprised and said that it was too much. however after thinking about how direct debits work, and reading the many cases on here of people simply wanting the money back for the sake of it, even though they are clearly responsible for going over their limits, i think the charges are about right."

And which level is about right? Natwest now charge £5 for an unpaid item, until sometime last year they used to charge £38, around 2000 it was £12. Nothing has changed in the interim in terms of thier costs and processes and they haven't stated that the reduction to £5 was anything to do with the test case (which I don't believe BTW).

Regarding direct debits its the company that requests the DD, the bank doesn't do an awful lot except where there is an indemnity claim and even there most of this would be handled by computer. Mind you they still charge for an unpaid standing order, which is even harder to defend. They've done nothing yet they charge? Hmm I'm clearly in the wrong job.

"ill ask you this. before people could claim their money back, what happened to them? were they made bankrupt? did they end up on the streets? no. in the vast majority of cases they paid it, absorbed the cost, and hopefully learned a lesson."

I've no doubt some did go bankrupt purely because of charges, you know the whole snowball effect I've mentioned about five times. I've no doubt some managed to absord them with varying degrees of difficulty. Since neither of us have figures we're not in a position to say whether its more common for charges to cause problems for the customer or not.

"lets get the competition or the monopolies commision and get it sorted properly then. i would welcome that on more than a few fronts including supermarkets and oil companies."

I agree with that, I believe the conservatives said they would do just that, lets hope the other parties also have some useful ideas. What I want to know is why hasn't the OFT done this already given the uniformity in the charges?

"if lowering bank charges would make people stop and think and slow down the race towards consumer oblivion i would be all in favour. but it wouldnt, it would make it worse."

Maybe, maybe not. Maybe they would be less bankruptcies if charges were lower. We don't know since we can't predict the future.

"of course it's not unstoppable."

Depends on the individual, some people can cover a few charges, for some people one charge starts the snowball effect. If you believe up to £100 is reasonable you need to understand the banks the charges can reach hundreds or even thousands of pounds. For someone on a meagre income they are screwed from day one. I agree they shouldn't incur the charge in the first place, but once dont I don't think its fair they should be driven to the wall because of one mistake. This argument is particularly powerful if the bank does things like apply a charge immediately since this is clearly designed to generate more charges.

"you dont have to pay by direct debit or take out a loan."

No you don't but you do need a bank account if you want to get paid ever. So I can choose to save £100 a year on my gas and electricity if I pay by DD, or risk financial oblivion if I opt for DD. The trouble is many people don't see it this way, they believe the banks flannel that DD's are safe, secure and convenient.

We agree on one thing companies and banks promote DD's for thier benefit. I would advocate standing orders for people on tight budgets. Its about control, a DD says a company has unfettered access to your account. There are rules but they leave a lot to the customer and are poorly enforced. Companies don't give discounts for standing orders in my opinion because they don't have control.

"but you want to make the banks a special case, that i dont agree with."

There used to be a requirement called utmost good faith, the banks have totally lost sight of that. It is precisely because the bank is looking after your money that they are a special case. For example if there was an amazing new savings account on offer the bank cannot, and should not, put me into it without my consent. It may not be suitable for me.

Yet in relation to DD's they decide whether or not to make a payment, a process the customer has no info on or input into, and this decision determines which charged is levied. We know they are out for themselves so I bet the computer decides which charge will generate the most revenue.

"you want me to actually tell you why a million pounds would be a silly charge for going overdrawn?"

Yeah sure, it might inform the debate. Whilst you are on it would be helpful to state what differenties a reasonabel charge from an unreasonable one. Would £100 be acceptable? £1000? £20?

"as far as the customers "fault" is concerned, it is up to them to stop spending beyond their limits, nobody else.

you seem to be muddling it all up, its quite clear:

its the responsibility of the bank to set their charges. its the responsibility of the customer to manage their finances."

I'm sorry you feel I'm muddling things up, there are two sides to every story... The world is not black and white my friend, there are many issues which overlap when discussing bank charges, many seperate problems and scenarios.

So here goes, I AGREE that it is clearly the customers fault that a charge is incurred. We'll ignore errors by the bank or the company, assuming they will be effortlessly solved by the direct debit guarantee. I AGREE that there should be a charge for this, but then you make a mighty leap.

You go from and dammit they should be charged to and the bank can charge whatever they want. The level of the charges has a direct impact on the customers ability to manage thier finances.

Its a bit like getting done for drink driving, its stupid and dangerous. If a professional footballer gets fined a few hundred quid it makes no difference, if they get banned from driving they hire a driver. Put your average Joe in there and the same sanctions cause much larger problems.

Now it would be very difficult for the bank to charge based on a persons ability to pay so far simpler to just pass a law saying companies can only charge thier legitimate costs. This would also get rid of those annoying admin fees for paying by card or for not paying by direct debit.

I say yet again the banks initially claimed that these charges WERE to cover this costs. It was only in the face of overwhelming evidence to the countrary (despite them refusing to give thier actual costs!!!) that this service fee idea popped up.

Shall we just agree to dis-agree? I'm getting tired of this.