Free banking 'will be axed'

dchurch24

Personally, I will be over the moon when someone has a court case over this - I have been trying to get one of them into court for over 12 months now!

I didn't say that they shouldn't make a profit - I simply say that they should do it legally, like every other business has to in this country.

I can't see a problem with that.

If the bank wins everyone will scuttle off and this freeloading gravy train can be put to rest

If the bank loses the banks will scuttle off and this freeloading gravy train can be put to rest

CopperPlate_2

How naive.

The banking industry do not make all their profits from charging current account customers for defaulting or breaching their overdrafts. If this amounted to the estimated £19 billion that the "Big 5" are to announce over the coming weeks, then the financial acumen of their customers really needs to be questioned.

So are we to enter a modern, post-communist era where the banks - and why stop at the banks, what about the insurance industry, supermarkets, estate agents, and any other profit-generating industry - are allowed to make a profit, but with a ceiling? How ridiculous. How very 'right-on' though.

And to think that should the bank lose in court, that it will simply accept the hit on the bottom line is, again, naive. As we've seen in the papers recently, and has already been trailed on this site, the banks will find other ways of recouping the lost revenue. And ultimately it will be the people who have never been in debt, who have never breached their overdraft, who manage their money carefully and do without whatever it might be that will end up being financially worse off (and there are those that will say that they are the privileged ones, the ones who have enough money not to worry - but they can't all be like that. They can't all be the 'wealthy ones', just ordinary people who know what they've got and how much they can spend).

And will those who have reclaimed the cash back from the banks stop and think about the damage that might have been caused by the mass freebie-cash feast that they've participated in, whether they have a moral or legal right to claim it back? Probably not.

The theme of some posts on this thread can only be described as offensive - comparing this situation to that of World War II must be deeply offensive to those who lost family or friends and who fought for the right for us to have a choice. I cannot believe some posters put this money-grabbing, selfish, and 'freebie culture' on a par with something of this magnitude with regards to rights and freedoms. It beggars belief, and I'm sure makes the majority of people feel quite ashamed.

isasmurf

http://www.moneyextra.com/news/news-hsbc-denies-022826.html

Dyfrig John, CEO of HSBC plc, said HSBC has "no plans to end free banking" and will "always offer a free bank account."

oldwiring

Will the account facilities be the same as now? he has not said present accounts with their facilities will continue, only that there will still be free banking.

Its like the government's commitmanet not to raise the standard rate of income tax. They effectivley negated the effect by raising NICs and not uprating personal allowances in line with inflation.

CEOs of large organisations know political-speak as well

inmypocketnottheirs

Tootsie_Roll wrote:

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.

Well if the likes of your employer (obviously employed in the bank or financial services sector) choose to operate on the edge of the law, then what do you expect.

Free Banking is not a right you know. And I am sure you know the truth about a free lunch??

Tim_L

CopperPlate wrote:

How naive.

So are we to enter a modern, post-communist era where the banks - and why stop at the banks, what about the insurance industry, supermarkets, estate agents, and any other profit-generating industry - are allowed to make a profit, but with a ceiling? How ridiculous. How very 'right-on' though.

...

And will those who have reclaimed the cash back from the banks stop and think about the damage that might have been caused by the mass freebie-cash feast that they've participated in, whether they have a moral or legal right to claim it back? Probably not.

First point: regulated monopolies and quasi monopolies are regulated precisely so they can't take advantage of their situation to make excessive profits. It has always been thus. If the banks act as a cartel by moving together to charge customers for current accounts, then I think you can assume the OFT will take an interest. But I don't think it will happen generally: the current account market remains very competitive, and there are still plenty of players looking for market share. The HSBC announcement has a great deal to do with making scapegoats of the OFT and those reclaiming charge.

Which leads me on neatly to the second, quite ludicrous statement. If you follow this logic, anyone who has ever claimed on their insurance should be ashamed for increasing the level of premiums for the rest of us decent people that haven't. If you have a moral and or a legal right to claim the restitution of something unlawfully taken then why on earth would you not claim? Just so some vituperative misanthrope on this board can have free banking? This is not a "mass freebie", because people are only claiming back their own money.

On the other hand generalised free banking certainly could be described as a "mass freebie". So could stoozing, so could bonus surfing, and so could rate surfing. Any mass consumer activity that hits bank bottom lines will bring some sort of reaction. Yet the "virtuous" activities are somehow ignored in the rush to condemn those who are characterised as being reckless !!!!less individuals abusing the system.

Others have chosen to paint this as a political issue: I have not (in fact I am by inclination a Conservative and free marketeer - someone less "right on" you could not hope to find). But I have to point out that generalisations and slurs based on generalisations have been used throughout history by both left and right as a means of persuading the "majority" to take a particular view about that group. It's manipulative and rabble rousing. In this case, we are being manipulated by the banks to believe that current account charges are inevitable, and it is the fault of those claiming charges back and the OFT, where in fact the truth is this is something banks have wanted to do for ages and there is no causal link: if a business can see a way of making more profit, then it will do so. I'm sure if they could maintain both penalty charges and current account charges they would do so.

I'm with Dchurch on this, basically. The selfish "I'm alright Jack" attitudes demonstrated on this board to fellow people are profoundly disturbing. Are we becoming so parsimonious that the idea that we might be charged for our own banking allows us to lose all sight of the problems of fellow human beings in marginal difficulties?

debtfreelondon

The main difference between banking and other service industries is choice.

There is a plethora of choice in every other industry. No, we wouldn't ask Marks and Spencer what their mark up was but we wouldn't pay that price if it wasn't deemed value for money (in our opinion) and would shop elsewhere.

As Banks are heavily legislated they appear to have formed a banking club and charge similar fees, have similar products and penalise in the same way. There is scant difference between them save for the odd gimmicky account (monthly savers seem to be the "in thing").

Adding charges to current accounts even when the accounts are in credit is, in theory, correct as banks don't have to give you an account and can charge to do it. In the UK, however there is a history of overcharging on accounts. Prices for cheap to offer services, such as DD's, STO's etc which are of negligible cost to the bank are overpriced.

Personally, I would be prepared to pay for a bank account if it offered me value for money and services that I needed. I don't want an account that has free travel insurance if I never go abroad, breakdown cover if I don't have a car, commission free travel money with rates that are ludicrously low or the ability to buy goods that can be bought much, much cheaper elsewhere (home insurance, white goods). These are gimmicks to lure in the unwary consumer who knows no better.

If banks start charging for accounts, however basic, something needs to be offered or consumers will move elsewhere and we will get into the situation where thousands of customers move their accounts around in an endless cycle of "getting the best deal", affecting their credit rating. Banks need to offer more before charging. A system of benefits which you can pick and choose.

My main fear is that charges will come into place which do not reflect the level of service offered to you and where other services which are currently charged for are decreased by a negligible account. Either that or the banks will come up with even more complicated structures to seemingly offer the best deals whilst offering not much of value.

dchurch24

So are we to enter a modern, post-communist era where the banks - and why stop at the banks, what about the insurance industry, supermarkets, estate agents, and any other profit-generating industry - are allowed to make a profit, but with a ceiling? How ridiculous. How very 'right-on' though.

Not at all. I don't think it's too much to ask though that the above mentioned market sectors make their profits legally, lawfully and completely within the limits of laws of the countries that they operate. Do you?

and there are those that will say that they are the privileged ones, the ones who have enough money not to worry - but they can't all be like that. They can't all be the 'wealthy ones', just ordinary people who know what they've got and how much they can spend).

...but everyone who incurs bank charges are apparently frivoulous with money and need to learn more money management skills. It may suprise you to know that at any given moment, I could have (and still can) tell you exactly what is in my current account to within about £5, yet I still 'managed' to incur charges to the tune of nearly 2k. Yet, despite the real reasons behind it being outside of my control - short of growing some sort of psychic ability - apparently I am terrible with money and should learn to manage it better etc..etc...

And will those who have reclaimed the cash back from the banks stop and think about the damage that might have been caused by the mass freebie-cash feast that they've participated in, whether they have a moral or legal right to claim it back

Did the banks think about the damage they have caused by acting outside of the law? Did they think about the woman in Sctoland feeding her kids on nothing but breakfast cereal for two weeks because her benefits were paid late resulting in over twice the benefit amount being taken in charges? No, of course not - they never dreamt that they would get caught out and brought to order.

If anyone has a moral and legal right to something, it is their duty to claim it surely.

I'm glad you have conceded that there is a moral and legal right to claim what is ours back though. Thank you.

The theme of some posts on this thread can only be described as offensive - comparing this situation to that of World War II must be deeply offensive to those who lost family or friends and who fought for the right for us to have a choice. I cannot believe some posters put this money-grabbing, selfish, and 'freebie culture' on a par with something of this magnitude with regards to rights and freedoms. It beggars belief, and I'm sure makes the majority of people feel quite ashamed.

To liken what has been proposed here is exactly like the Enabling Act (1933) which was passed by Hitler allowing laws to be passed without scrutiny and to allow laws to override existing case law without question. What resulted there is clear for all to see.

What has been proposed here, allowing the banks to override existing case law without question, I think is a fair comparison. Particularly as the banks in question are bankrolling the existing Govt. and then writing off loans as a way around the laws that were put in place to stop that sort of thing happening.

Is the comparison too difficult for you to grasp?

Please research some things before posting. Many people have posted on this issue with an air of authority, yet clearly without any research at all. I then get blasted for not managing my finances properly, when in fact, I have always been meticulous with my finances as I am about anything I have an interest for. It's a pity that so many people critisise others without a) knowing all the facts, and b) doing any research before making the comments.

Also, almost as a side note, the ECHR clearly states that an EU citizen should not be hampered in their work by a seperate commercial entity, or by legislation. Also, EU citizens must not be forced into buying a service or product by legislation.

The reason I know this one is because I researched the legalities of the Govt. forcing people into private pensions.

However, a side note from that is, that there is legislation in place (Employment Act 2002) that gives the right over how wages are paid to the employer, prior to 1984 it was the employee. This means that effectively we are forced into having a bank account if our employer deems it to be that way. If we then have to buy that service it becomes a breach of the ECHR.

For a bank to charge for each DD or SO however, would be legal as you do not have to use those services.

This is exactly how it works in Holland for example.

In Holland the average price is (rough conversion) £1.30 per month to pay up to 15 Direct Debits out of a current account. You will find that cheques will clear there the same day as well (as they do in Sweden, where the banks said it was impossible to do, that is, until the Govt. stepped in and made them do it within 6 months - ahh - what it must be like to have a non-guttless Govt.)

I, for one, would gladly pay £1.30 per month if it meant the end of the poorer of society getting shafted by banks in unlawful ways.

dchurch24

My main fear is that charges will come into place which do not reflect the level of service offered to you

Blimey. If they reflected the level of service we recieve now, they'd be paying us to have the accounts with buckets of cash!

[Deleted User]

will the charges be axed?

How do you know?

Guesswork or evidenced based?