Personal Reserve Fee's

Ali79

I don't know if anyone else has got into a financial mess due to personal reserve fee's. I have been having battles with my bank for the last 18 months to try and turn my personal reserve of £500 into an agreed overdraft to try and reduce the charges (£728 to date) and they have denied this request time and time again. I have complained about this and have recently received a letter from them stating that because of the recent legal proceedings and outcome they do not have to uphold my complaint. I have written a letter in response and would like to post it here to see if anyone has on opinion/advice on this. Sorry it's a bit long...I did kinda get on my soapbox!

Dear Mr Henderson,


Thank you for your letter dated 12th January 2010 regarding the complaint made by myself regarding personal reserve fee's.


I would firstly like to challenge a comment made in the second paragraph of your letter which states that I was 'previously advised' that you would be reviewing the impact of legal proceedings before my complaint was dealt with. I would like to know in what way you 'previously advised' myself of this? I believe that the complaint I originally made was sometime in September following the deduction of £132.27 for personal reserve fee's (£110), returned transaction fees (£16.00) and overdraft interest (£6.27). shortly after I received a letter from Barclay's informing myself that the complaint would be investigated and I would receive a response within one month (I was unfortunately unable to locate this letter so I do not have the specific date). From that point I received no further correspondence on this matter until your most recent correspondence. As someone who has been a customer of Barclay's for many years I felt completely undervalued as a customer for this non response on the part of your bank.


Secondly, my complaint had nothing to do with the current legal proceedings as it concerned fees for a personal reserve rather than unauthorised overdraft fees, a point which you even mention in your correspondence. My complaint was concerned with the fact that I had on numerous occasions requested help from your bank in regards to my financial circumstances and the difficulties I was facing regarding my income at that time. My requests for my overdraft to be increased up to the reserve amount to try and prevent further fees was denied time and time again. I even suggested a reducing overdraft where I could pay back the reserve over a reasonable length of time. I pointed out to members of staff that my circumstances would be improving in October 2009 as I would no longer be a student nurse living on an income of 10K pa but would be starting full time employment as a qualified Staff Nurse on an income of 21K pa, therefore paying back the overdraft would not be an issue.


Thirdly, my complaint does concern the fairness of these charges, and also the morality of a bank that will prey on those individuals on the lowest of incomes to make further money. From the 30th August 2008 I have paid a total of £728 in personal reserve fee charges, a total of £128 in returned transaction charges (transactions that were returned due to the fact that the personal reserve fee charges meant I did not have enough money to pay my bills) and £350 in charges for the privilege of having an account that does nothing for me but take my hard earned cash! Even now, when this account is not being used and is under your collections department I am still being charged £25 per month for this account! In what way is it fair and morally right to deduct £1182 over 18 months for a reserve worth £500?


My fourth and final point is that I did not at any point request to have a personal reserve on my account. The first time I went into this reserve I was not aware it was there. I accept full responsibility that I should have checked my balance prior to withdrawing money from an ATM, however I was not to know this reserve was in place as I had not been informed of it at this point and being able to withdraw money I assumed (wrongly, I now know) that my account was within it's overdraft balance. It was this initial transaction that sent me into the spiral of fees I've since encountered. If this Reserve had not been available on my account the situation would not have occurred, and if you had asked me if I wanted the reserve I would have declined due to the extravagance of the charges. For this reason your bank must take some responsibility for the financial situation I find myself in today despite whatever legal proceedings have recently taken place.


I anticipate your swift response to my complaints and would take up your offer of my case being reviewed by the Financial Ombudsman Service if your response is not to my satisfaction.


Yours sincerely

Premier_2

What do you mean by "Personal Reserve"? Do you mean the additional, optional service Barclays offer?
http://www.personal.barclays.co.uk/BRC1/jsp/brccontrol?site=pfs&task=homefreegroup&value=14790&target=_self

If so, it seems to be a bonus as it allows you to go OD (or OD on your authorised OD if you had one) without being charged the usual unauthorised OD fees. No interest is charged either.
However, there is a £22 charge for each 5 day period you use the reserve.

As the service is optional, I guess you don't have to have it. Why not tell the bank to remove it, or set the reserve at £0.00 ???

Or are you simply hoping the bank will agree to an authorised OD in lieu of the personal reserve amount?

natweststaffmember

As a personal reserve all customers were OPTED IN in August 2008 and were sent a letter with regards to this. Furthermore, Barclays were putting on hold themselves any complaints about the fairness of the charges. Morality is no argument to have since the argument can be turned around and some would ask about the morality of "using the banks money". The fourth point I have covered.

I would await the new guide to reclaiming and decide what you wish to do from that point onwards. I personally did not agree that you should be automatically opted in but I have always advised opting out of this and you would have incurred only the £8.00 charges rather than the £22 plus £8

Ali79

I get the points made, however I do feel that the fee's for a personal reserve are on a par with those charges for an unauthorised overdraft. Even if I went a £1 into that reserve I would still receive a 'fee' of £22 and I would be charged that every 5 days I remained in that reserve. I realise that I managed my account badly but this was mainly due to situations outside of my control (I was signed off sick for 6 months and received no income for this period).
My main complaint is that I requested help once I realised I was in a situation that I could not get out of the reserve and the more I was charged the less able I was to improve my situation, no help or advice was offered from the bank.
I no longer have a reserve on the account as it is now with their collections department and I am now paying it back on a month by month basis (something I requested to do months ago by means of a reducing overdraft).
With regards to Barclay's sending out letters informing customers of the opt in for personal reserves, I did not at any point receive one of these, the personal reserve just appeared on my account. I'm sure the personal reserve works well for some people who occasionally need to go briefly overdrawn but for me it was a nightmare and left me in a situation that some weeks I could barely afford to buy food.
I am pleased to say that my financial situation is now improved and I am slowly paying things back but this debt could have been so much less if the bank had done something when I originally requested help.

natweststaffmember

Ali79 wrote: »

I get the points made, however I do feel that the fee's for a personal reserve are on a par with those charges for an unauthorised overdraft. Even if I went a £1 into that reserve I would still receive a 'fee' of £22 and I would be charged that every 5 days I remained in that reserve. I realise that I managed my account badly but this was mainly due to situations outside of my control (I was signed off sick for 6 months and received no income for this period).
That is grounds for financial hardship. I would still ask the bank to look retrospectively at those 6 months you were off and the circumstances, etc,etc,


My main complaint is that I requested help once I realised I was in a situation that I could not get out of the reserve and the more I was charged the less able I was to improve my situation, no help or advice was offered from the bank.
I no longer have a reserve on the account as it is now with their collections department and I am now paying it back on a month by month basis (something I requested to do months ago by means of a reducing overdraft).
With regards to Barclay's sending out letters informing customers of the opt in for personal reserves, I did not at any point receive one of these, the personal reserve just appeared on my account. I'm sure the personal reserve works well for some people who occasionally need to go briefly overdrawn but for me it was a nightmare and left me in a situation that some weeks I could barely afford to buy food.
I am pleased to say that my financial situation is now improved and I am slowly paying things back but this debt could have been so much less if the bank had done something when I originally requested help.

Please see the above and perhaps ask the bank about those 6 months when it was at is worst.

Ali79

Thanks for the advice...will do that.