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

Stormy

eslick wrote:

Looks like FD are already taking a hit on this.

I hope they do! I banked with FD for over 5 years and had my salary, and savings, ISA's etc with them. I woke up one day and realised while the customer service was great the products they offered were very poor in comparison to the rest of the market. I began moving my money elsewhere.

The final straw was when I got charged for moving a big cheque balance into one of my savings accounts. It was for some reason listed as "available" on my current account balance but infact was not, so I got charged for going overdrawn. The CS rep must have been having a bad day as she was snooty as hell about it. I said fine, say goodbye to my money.

From that day I have had very little money on FD, I used the e-Savings for a while but the interest rate is now a pale shadow of the competition and they restrictions on moving money out make it not worthwile. (Best to stick with Icesave.co.uk or ICICI). I basically use the current account as a dumping ground for cheques as there is a HSBC in my local town, but no Nationwide (my main account now).

I'll be closing the accounts today and saying bye bye to FD which is a shame as they still do have great CS. As for the people who say its only £120 a year, its £120 a year you DONT need to pay.

Mike

DGGS_2

I also bank with First Direct and when this thread first appeared I rang to ask if it was true. They told me they had no plans..........

Now ir IS true but they pointed out that all I had to do was have a "Savings" account with a zero balance and I wouldn't havr to pay. I did this but I'll probably move anyway - it just bought some time (free!)

Rafter

Why shouldn't they charge customers who don't use their accounts actively?

Why should I as a loyal first direct customer get worse interest rates because customers only opened their account to get some joining bonus or have moved their finances elsewhere?

There is a cost to running a bank account, staff, systems, cheque books, cards, internet, branches, statement etc which probably amount to over £50 per year for every customer.

How should the bank recover this money?

Charge some customers unlawful penalty fees? X

Pay lower interest rates to loyal active customers? X

Or charge a fee to customers who don't use their accounts enough to cover the costs?

I think this is actually a positive step. First direct doesn't have a basic bank account so is not excluding the low paid. Nor is is a monopoly, there are other choices.

First direct cannot continue to offer premium service, UK only call centres, above average interest rates etc etc. Particularly when the OFT reduces penalty charges to a maximum of £12 next year.

R.

dchurch24

Particularly when the OFT reduces penalty charges to a maximum of £12 next year.

Do you know something we don't?

Secret_Wookie

Rafter wrote:

Why shouldn't they charge customers who don't use their accounts actively?

Why should I as a loyal first direct customer get worse interest rates because customers only opened their account to get some joining bonus or have moved their finances elsewhere?

There is a cost to running a bank account, staff, systems, cheque books, cards, internet, branches, statement etc which probably amount to over £50 per year for every customer.

How should the bank recover this money?

Charge some customers unlawful penalty fees? X

Pay lower interest rates to loyal active customers? X

Or charge a fee to customers who don't use their accounts enough to cover the costs?

I think this is actually a positive step. First direct doesn't have a basic bank account so is not excluding the low paid. Nor is is a monopoly, there are other choices.

First direct cannot continue to offer premium service, UK only call centres, above average interest rates etc etc. Particularly when the OFT reduces penalty charges to a maximum of £12 next year.

R.

Its a good point.

I bet a fair few people who leave may change their minds and come back when they experience the level of service on offer elsewhere.

There is a reason that no bank can offer the best rates on every product. If they did they would lose money on everything they sell. First Direct offer a good balance between well priced products and service.

Chase the best rates when you can, but don't expect to get the best service available chucked in for free without buying something.

eslick

Rafter some good points but the issue here is simple, if FD were to get away with charging they will start charging for all their services and anyone who isnt charged now will be. Other banks will follow and the banking industry will change as we know it. We will end up with the same as in the US where all current accounts are fee paying. The next few years will see many changes to the banking systems in terms of how long it takes for payments to reach our accounts and the very poor improvement in cheque payments that was announced yesterday. All of these things will make the banks want to charge for all current accounts and if FD are the first others will follow.

dchurch24

There is a cost to running a bank account, staff, systems, cheque books, cards, internet, branches, statement etc which probably amount to over £50 per year for every customer.

How should the bank recover this money?

Charge some customers unlawful penalty fees? X

Pay lower interest rates to loyal active customers? X

Or charge a fee to customers who don't use their accounts enough to cover the costs?

Or, do as all the other banks do, which is to pay under-inflation interest (and thus making money) and invest the money in ventures that will yeald big returns.

Contrary to popular propaganda, banks DO make a profit from current accounts. HSBC finally admitted so last year. It was in the region of about £2 profit each week per customer. That's millions of pounds per week. There's 30 million current accounts in the country. So all of the banks have a share of 60 million quid each week.

My heart is not yet bleeding for FD.

mrcow

karatedragon wrote:

Reading these postas anyone would thnk the world was coming to an end. Theres far worse tihngs going on in the world than FD charging a tenner a month like People dieing, polar ice caps melting and deforestation. Things just have to be brought into perspective.

Okay so global warming is a serious issue so that justifies FD charging their loyal customers £10 per month :rotfl::rotfl: Great argument :rolleyes:

Please get a grip. This is a money saving site.

FD don't offer their customers anything additional that any of the other main banks do. Their rates are nothing to write home about. UK call centres? Oh please, how often do you have to call your bank? If it's that often get online banking (FD's online banking isn't anything special either).

How they can then turn round to customers and say to move their mortgage to them to avoid this monthly charge......do they really think their customers are that naive?

truth_2

Hi

Well to those that are closing their accounts, it will not be bothering the bank. In all honesty, fd are trying to get rid of the customers who are being charged as they cost the bank money. Some may say well I never use it, how can it cost them money? Think about the amount of money wasted on account monitoring by staff, when the account is used for once it is flagged up for fraud so it has to be chased, the amount of money in terms of overheads for these customers is also ridiculous, ie: having to send statements every month. Furthermore, these sort of customers with dormant accounts increases the banks bad debt situation.

mrcow

truth wrote:

Hi

Think about the amount of money wasted on account monitoring by staff

Great stuff, well when all the unwanted customers have been pushed out, FD can then start sacking some of these excess staff members that they have.

Money saving all round! :T