Free banking 'will be axed'

grade15

well, i'm sure there will be a surcharge of ppl out there using the uswitch for banks!!! or comparision sites .. :dance:

dixie_dean_2

Prosaic says...

The current system says 'stay in credit and we won't shaft you' - fall into debt and they'll punish you financially for doing so

2 related points - the implication from the first half of this "sentence" (i use the word loosley) is that if you aren't in credit they will shaft you. I didn't think businesses were meant to shaft any of there customers. Second, I have to think you have not read any of what all this is about. Its against the law to punish people for breach of contract. The banks were/are breaking the law - hence why people can claim back charges.

Graham_Devon

Theres no denying that all those claiming charges have shot themselves in the foot and the rest of the population. Something had to give.

Thats not to say that I disagree with claming the charges as they were and have been proved illegal.

If no one had claimed charges I doubt very much this would have happened. This isn't the only site that tells you how to do it and more and more poeple will be doing it as word gets around.

I've only been charged twice, so can't be bothered with the effort, but if it was worth my effort, I'd still do it.

Andy_L

M_Thomson wrote:

Around 70p a litre you pay at the pump is given to Gordon. If we didn't have to pay this tax, we would have the cheapest petrol in the western world.

and would just have to make up the lost higher tax revenue somewhere else - higher income tax instead anyone?

Anyway, were current the 6th (out of 25) most expensive in Europe for petrol
http://www.theaa.com/onlinenews/allaboutcars/fuel/2006/July2006.doc

rrobbo

My personal view is that in the UK right now we have a surprisingly 'generous' banking system, albeit with a tendency to exploit the vulnerable and the lazy (I have probably qualified as both at various points in the past, so know from experience that it's true).

Right now I have a number of credit cards that I use with absolutely no cost to me (even the ones with annual charges waive those charges when I threaten to cancel the card). I automatically pay all the cards off at the end of the month so that I don't have to pay interest or charges. Using the cards means that I keep cash in the bank longer, which means that I'm earning/saving interest until the card is paid. And to cap it off I get a cheque at the end of each year for between .5% and 1% of the amount I've spent. Some cards even given cash-back amounts of 10% or more on certain deals. I'm effectively being paid to take somebody else's money. There is an argument that everything that I buy is at an inflated price because the vendor has to pass on the cost of accepting my card in the first place but, with a few exceptions, I'm paying the same price if I use cash anyway.

I could also get free current account banking if I wanted. I actually choose to pay a monthly fee because it gives me additional services and benefits. With First Direct I pay £11.50 a month (was £9.50) for my account but that includes mobile phone insurance, travel insurance and no foreign exchange charges for withdrawing money abroad (I travel abroad a lot). The extra benefits also included a £100 cashback when I took out a mortgage with them. Because of the cashback this has been an extremely good deal but stacks up reasonably without it (I'll review the situation if the price or benefit changes).

My one hope is that there will remain sufficient competition in the banking market that most people will find a deal to suit them one way or another. Right now there are people paying large fees and interest rates on unarranged overdrafts and uncompetitive credit cards who could avoid or reduce their costs simply by tidying up their finances. I've got to admit that I love these people - they subsidise my free banking to a great degree. Even if the nanny state decides to look after these people's best interests when they can't be bothered to look after them themselves, I'll rely on the ability of the banks to find alternate ways to take money off them and to provide a flexible enough system by which I can still get what I want from them at a suitable cost. If I'm not happy with the deal that I'm getting then I'll look around until I find the best deal even if that involves leveraging all my business (mortgage, current accounts, ISAs, shares, credit cards, etc) to make me a better commercial proposition to somebody.

Ultimately, my point is that these latest proposals will simply be another in a long line of changes to the way that financial services operate and we simply need to assess the way that the changes manifest themselves and determine if it's worth making some changes to get a better deal. Some people will be better off, some people will be worse off and some people will be totally oblivious to what's going on around them.

Tootsie_Roll

MPH80 wrote:

Hi Dixie - they can justify it because - on average - they make £1.05 a week off you.

The link for that quote is here: http://news.bbc.co.uk/1/hi/magazine/4781924.stm

This is an avearge figure based on their profit divided by the number of customers; the reality is that it actually costs banks money to operate a current account which means they are making a loss on accounts that offer free banking which has been subsidised for many years by business customers, mortgages etc etc. Until now they have been happy to carry this loss as it opened up other opportunities for them as has already been mentioned.

As some of us have been saying for months now, we now have the CAG et al to thank for the withdrawl of free banking - Power to the People - Not !! Once again the small minded minority ruin it for the majority.

dchurch24

Theres no denying that all those claiming charges have shot themselves in the foot and the rest of the population.

Not at all. If there is a reasonable fee for a service, I have no problem in paying it.

If it means that people are not forced to feed 2 children on one box of breakfast cerial for a fortnight (just on example of the effect of 'free banking' in this country), then I am happy to pay.

Power to the people - yes.

I think it's a very selfish person that would rather see even just one person have to go through this rather than pay a fair price for a fair service.

I guess that the reason people are so against the idea is because the service received from banks is so very poor that it's not worth paying for at all.

That's still no excuse to get it for free while people are shafted left, right and centre to the point where in a civilised society they cannot afford to eat or clothe themselves, to pay for it.

I am happy that the CAG has in no small part bought about this change (if indeed it ever happens).

Let us not forget, the banks are STILL charging, and there is no current investigation into these charges at all. I think the banks will carry this on for as long as they possibly can, whilst spreading propaganda about the end of 'free banking'.

A familly member of mine used to work at A&L - at any one moment there was £2 billion quid sitting in a 'clearing' account. Even at just the 3.4% libor rate overnight (and yes, that includes weekends and other 'non-banking' days), you can see that the crock that is "we don't make any money out of personal bank accounts" is truly a lie.

If it were true, banks simply wouldn't do it any more.

A&L isn't even one of the 'big 4'.

Prosaic

dixie_dean wrote:

Prosaic says...

The current system says 'stay in credit and we won't shaft you' - fall into debt and they'll punish you financially for doing so

2 related points - the implication from the first half of this "sentence" (i use the word loosley) is that if you aren't in credit they will shaft you. I didn't think businesses were meant to shaft any of there customers. Second, I have to think you have not read any of what all this is about. Its against the law to punish people for breach of contract. The banks were/are breaking the law - hence why people can claim back charges.

AFAIK that has yet to be decided in the courts. If only some bank customers put the same effort into staying within their limits as they do participating in 'lobbying' websites
Sure incur 25 quid if a cheques a day late, but some people owe tens of thousands! Pure irresponsibility which the rest of us will have to pay for

Did you think businesses were set up to help you? Did you think that if you took their money without asking they would be happy about it?

If so can you let me know your address I have some great seafront property in Birmingham you might be interested in :j

dchurch24

Did you think businesses were set up to help you? Did you think that if you took their money without asking they would be happy about it?

What about when you don't take their money, but just don't have enough to pay a DD or SO?

Personally, I DO think the banks are happy about it - to the tune of nearly 4 billion quid a year happy.

Prosaic

dchurch24 wrote:

What about when you don't take their money, but just don't have enough to pay a DD or SO?

Personally, I DO think the banks are happy about it - to the tune of nearly 4 billion quid a year happy.

You don't like them making profits? in a capatalist country they won't last long giving it away.
Maybe you'll be happy when they close a few branches and sack a few staff to pay for those who are storming the gates for their 500 quid because 'I didnt know it would cost that much, innit?'

Personally I'll be glad when someone has a court case with this. If the bank wins everyone will scuttle off and this freeloading gravy train can be put to rest