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

climbgirl

honey_bee1384 wrote:

Is there any substantial proof that other banks will follow suit though?

Yes, global banking trends indicate they will and usually do follow suit. I don't believe this will happen immediately, I think First Direct will get hammered for this. But I also think this is HSBC testing the water with their subsidiary. First Direct will get hammered and take the rap. Then when it's settled a bit, the others will slowly follow. And First Direct will manage to get rid of all the dormant accounts that cost them money in the process!

Also, look at how easy it was to find a 0% credit card with no BT transfer fees of 2.5% six months ago. One of them started charging the fees, now they all do...

honey_bee1384

climbgirl wrote:

Yes, global banking trends indicate they will and usually do follow suit. I don't believe this will happen immediately, I think First Direct will get hammered for this. But I also think this is HSBC testing the water with their subsidiary. First Direct will get hammered and take the rap. Then when it's settled a bit, the others will slowly follow. And First Direct will manage to get rid of all the dormant accounts that cost them money in the process!

Also, look at how easy it was to find a 0% credit card with no BT transfer fees of 2.5% six months ago. One of them started charging the fees, now they all do...

If this is the case, then perhaps all FD customers who do not meet the criteria should do as a lot of people have said and switch banks immediately, if other banks see this wont they be less inclined to bring in charges like FD as they will lose customers?

I think i will look into another bank and let FD know about it, i'm not gonna be pressured into taking out products i dont need to avoid un-necessary charges. I'm obviously not good enough to be a customer of theirs.

jerrylatham

You don't want to pay the £10 per month charge being introduced in February? - Easy!
Just call them and open a savings account with £1 only; you do NOT have to add to this. I called this morning and they would not advise me how to avoid the charge, but by careful questioning they confirmed that a £1 deposit in their savings account I will not be charged any current account fee; my wife and I have 3 accounts - 1 joint and 2 individual; all we have had to do is open a £1 savings account each and both our individual and joint accounts are exempt from charges.

By the way - if you try First Direct's 0800 phone you will be told that you have to call a 'dedicated' 0845 number. If you are using a 0p per minute provider (eg 18185) the number that will deal with you is 0113 2345678 - you get straight through to customer services.
Go get it!
Jerry

EagerLearner

Message on their website right now... :rolleyes:

"calling us?

we are currently experiencing high call volumes. You may wish to call back later. If you have a query about the charges announcement, you will be receiving a letter with details shortly."

climbgirl

jerrylatham wrote:

You don't want to pay the £10 per month charge being introduced in February? - Easy!
Just call them and open a savings account with £1 only; you do NOT have to add to this. I called this morning and they would not advise me how to avoid the charge, but by careful questioning they confirmed that a £1 deposit in their savings account I will not be charged any current account fee; my wife and I have 3 accounts - 1 joint and 2 individual; all we have had to do is open a £1 savings account each and both our individual and joint accounts are exempt from charges.

By the way - if you try First Direct's 0800 phone you will be told that you have to call a 'dedicated' 0845 number. If you are using a 0p per minute provider (eg 18185) the number that will deal with you is 0113 2345678 - you get straight through to customer services.
Go get it!
Jerry

Yes, this will work in the short-term. But how long before they start closing these loopholes by setting minimum deposit rates etc?

I see someone else has posted calling it a brave new world in banking...it's interesting times for sure, I'm curious to see who will follow!

I just had a rather interesting call with HSBC when I rang to see if they'd be following suit. The guy I spoke to basically admitted without saying anything incriminating that they were "looking at their options" as well. I'll be watching them closely...

climbgirl

honey_bee1384 wrote:

If this is the case, then perhaps all FD customers who do not meet the criteria should do as a lot of people have said and switch banks immediately, if other banks see this wont they be less inclined to bring in charges like FD as they will lose customers?

I think i will look into another bank and let FD know about it, i'm not gonna be pressured into taking out products i dont need to avoid un-necessary charges. I'm obviously not good enough to be a customer of theirs.

Hopefully. But the problem with the banking industry is that they act very quickly when following other banks with charges (a lot slower with savings interest rises!), and the industry as a whole acts very non-competitively. Look at 0% credit cards. Six months ago it was easy to get one with no BT fees. Now they all charge them, they're a dying breed. Once one bank charged the 2.5% fee, they all jumped on board.

I'm wondering if there will soon be a bank left to switch too...

And sorry, but you probably aren't a good enough customer! I don't mean that nastily, but roughly 20% of banks customers lose them money, 60% make very little or no money for the bank and 20% are the ones who bring them the money. By doing this, I think HSBC are testing the water with their subsidiary (the HSBC CEO is quite open about wanting transactional fees in the UK) and also trying to shed the accounts that cost them money. Harsh but that's the way they view it!

regularsaver1

honey_bee1384 wrote:

Is there any substantial proof that other banks will follow suit though?

I think others will - they will try to recoup some of the funds they have had to pay back from charges

regularsaver1

mrcow wrote:

But perhaps these staff need to be thinking along these lines though? I'd be very worried if I worked for FD right now.

Any company who openly displays as little regard for their customers is surely not going to then bauk at the idea of additional cost cutting through cutting back on excess staff once they've suceeded in reducing their customer base?

I've seen it this other way recently at HBOS - they did something good for customers, but reduced staff in certain areas and I have been displaced

Bernard_Coleslaw

regularsaver1 wrote:

I think others will - they will try to recoup some of the funds they have had to pay back from charges

I'm not 100% convinced that's the reason, RS1. The KPMG (?) report on bank charges earlier this year suggested that default charges represented £billions in income for the big UK banks every year.

All the charge reclaiming activity we've seen (and don't forget, what we see here on MSE is not representative of the Great British public) is still a drop in the ocean against the context of bank profits as a whole.

I agree with you that others will follow suit eventually. But I don't think it's because of the charge reclaim debate. I think it's just because they can.

Cheers

BC

regularsaver1

Yeah your probabaly right Bernard - just a guess really. Still think others will follow suit