Avoid First Direct - They are gonna charge all customers £10!

davidjwest

EagerLearner wrote:

Where is all that accumulated money? Surely that is where the banks should now withdraw the 'refunded' charges from?

Most of it has been given to share-holders or "re-invested" into the banks themselves, so it's been spent in other words!

EagerLearner

davidjwest wrote:

Most of it has been given to share-holders or "re-invested" into the banks themselves, so it's been spent in other words!

Hmmm - then it should be 'tough ti*ties' Mr Banker - you shouldn't have spent what was overcharged in the first place :rotfl: And no, you can't now sting customers in other areas to recoup your loss... your fault for spending it!

The_Boss

Maybe First Direct and other banks will only bring in the charge for people who persisitently break the terms and conditions and not for the people that manage their account properly. That would be the just and logical thing to do.

ffacoffipawb

Mrs_Jangles wrote:

Just moved my account to First Direct a couple of months ago, upon recommendation from a friend who works in the call centre there and she apologised to me today and told me that they are going to charge all their customers £10 a month from next year unless you have lots and lots of products with them so guess I have to know look elsewhere for a bank account but at least I got £50 from them when I opened the account

Looks like this post was a panic-inducing piece of mischief making cojones, the motive (if any) will probably never be known.

Tim_L

First Direct (and HSBC, and others) were engaged in a kite flying exercise: nothing more to it than that.

Banks have long wanted to reintroduce charges on current accounts, and the current vogue for reclaiming penalty fees has provided convenient scapegoats. The banks have started a large scale whispering campaign to the effect that if penalty charges are reduced, everyone else will pay, which has the dual effect of directing a large sector of public opinion against the claimants and creating an expectation of charges - repeating the suggestions risks creating a self fulfilling prophecy.

Incidentally, as far as the costs argument goes, banks are not being asked to provide detailed breakdowns, but rather demonstrate that their cost structure broadly reflects the cost to them of transgressions across a boundary point: they won't do this not because it's difficult - in fact it's relatively easy if it were the case - but because these charges are used to generate revenue and cost nothing more than (say) targetted junk mail. This is implicitly accepted by anyone who believes that removing charges leads to increased costs for others, because if there were no excess there could be nothing to provide a subsidy.

Bluntly, if banks thought they could get away with charges for current accounts and for penalty charges, they would do both. The idea of charging for current accounts pre-dates the movement for penalty fee reclamation. It is naive to assume that banks set themselves a notional profit limit so if something is providing enough profit they won't bother with something else. Their job is to do everything they think they can get away with to make money.

There won't be generalised bank charges though, as the banking sector is still highly competitive, and there are plenty of smaller banks who would be delighted to pick up disgruntled customers from the bigger players. HSBC backed down very fast, as have First Direct.

What seems to be happening is that banks are trying to introduce separate charged accounts as "Private Accounts" or similar, trading off snob value (for example providing a "Black" card) or via some package of benefits. Probably the benefits of standard current accounts such as cheap overdrafts will start migrating upwards towards such accounts over the next couple of years, and probably the banks will start rolling up the idea of payment protection insurance with fees so that people tend to sign up to these accounts. I expect to see a fee paying current account with free PPI on overdrafts and linked credit cards pretty soon - remember where you read it first! You will also I think see the idea of free "upgrades" for a period of time, say 6-12 months.

CopperPlate_2

I thought that this thread might make refreshing reading again given the recent announcement by First Direct to some of their customers. An early Christmas present we could call it...

I think some of the comment here should be taken with a very large helping of humble pie. No?

smipx013

The facts are these:

First direct WILL start charging £10 per month per current account for those customers not paying in at leat £1500 pcm or with an average balance of less than £1500 in any one month UNLESS they have other savings products with First Direct.

I have been a customer since FD was launched and got the letter today as I am not meeting the minimum criteria. Not happy so I called them.

I was told that in order to avoid this I simply need to open up a esavings account and pay £1 per month in by standing order. The person I talked to set the new account up for me and set up the standing order.

What a bl***y joke and a waste of everyones time.

Paul

MORPH3US

Thats my account closed then......

M

mrcow

Closed mine yesterday

heatherw_01

When does this charge come in?