MSE Leaders' Debate: Bank Charges Future and Past

edited 28 April 2010 at 3:17PM in Reclaim Bank & Credit Card Charges
16 replies 1.8K views
Former_MSE_WendyFormer_MSE_Wendy
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This thread is specifically to discuss the Bank Charges Future and Past question in the guide:



To discuss or ask a question about the guide: click reply
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  • SmasherSmasher Forumite
    440 Posts
    The regulator has said that bank charges have halved on average since 2007. But we think the banks must move further and faster to treat consumers more fairly. So we will legislate to impose fair charges if progress on this is not good enough.

    If re-elected we will bring back – as quickly as possible – our legislation to give consumers a right to take collective legal action against the banks. The Conservatives blocked this in the last week of Parliament in April.

    And we will make it easier for everyone to switch their accounts to take advantage of better deals. We’ll do this by bringing in portable account numbers for everyone, which will be transferable like your mobile phone number, to take the hassle out of switching.
    So you lot should vote for me!:idea:
    Martin Lewis and I were in touch about this last year when the Office of Fair Trading was carrying out its investigation. Like Martin and many Money Saving Expert subscribers, I thought the Supreme Court ruling in December was a huge blow for consumers and we called for the OFT to look at other ways of getting a fair deal for consumers.

    For me, this issue highlights precisely why we need a new, powerful consumer champion to stop these sorts of problems from arising and fight even harder for consumers when they do. Our proposed Consumer Protection Agency would provide this kind of protection. It would take on the OFT’s powers for regulation and be given a clear mandate from government to protect consumers and punish banks who do the wrong thing. So for example, it would require far more transparency over bank charges, it will name and shame banks that break the rules and it will levy significantly larger fines that we have seen in the past.

    What’s more, we have also called for a competition review of the banking sector, including a close examination of bank charges. We need much more fairness and transparency when it comes to these issues, and a Conservative government would work to bring that about.
    So you lot should vote for me! :idea:
    Nick_Clegg wrote:
    It really is a scandal. The UK banks only exist because they have been bailed out by British taxpayers, yet financial service companies are still ripping people off – I don’t think that’s putting it too strongly. It means that customers who slip into minor difficulties can see mountains of debts pile up. Legal action against the banks hasn’t worked, so we will legislate to end unfair bank charges on unauthorised overdrafts, bounced cheques, or failed direct debits.

    Any charges really have to relate to what these mistakes actually cost the banks (I’d like a similar rule for transaction charges like credit cards to crack down on unscrupulous companies like Ryanair who seem to charge you just for breathing!). As for charges from the past, while it’s usually a very bad idea to pass retrospective legislation – I believe the banks have a moral obligation to pay them back. The idea that chief executives taking home millions of pounds a year can begrudge people struggling to get by a few hundred pounds simply beggars belief.
    So you lot should vote for me! :idea:
  • davidgmmafandavidgmmafan Forumite
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    "Any charges really have to relate to what these mistakes actually cost the banks (I’d like a similar rule for transaction charges like credit cards to crack down on unscrupulous companies like Ryanair who seem to charge you just for breathing!). As for charges from the past, while it’s usually a very bad idea to pass retrospective legislation – I believe the banks have a moral obligation to pay them back."

    Totally agree with this 100%, the others comments are just meaningless !!!!!!!!.
    Mixed Martial Arts is the greatest sport known to mankind and anyone who says it is 'a bar room brawl' has never trained in it and has no idea what they are talking about.
  • ILWILW
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    I would suggest that not all bank charges come from mistakes, but generally living beyond ones means.
  • ILW, you are absolutely right. what a perfect world we would live in if everyone was as angelic and financially sound as you.

    however, back on earth, whether its due to hardship or living beyond means, charges are still extortionate. if the bank dont want you to live beyond your means, they dont have to authorise the overdraft. simples.

    i am desperate for the tories to come out and make a statement like the lib dems have, if they do they get my vote, if they don't, i think i might have to grin and put a cross in the lib dem box, something i never thought i'd do in my life, and dont really want to either.
  • WidelatsWidelats Forumite
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    I heard that the banks got bailed out, and then kept the cash that was given to them, making it near impossible to get a loan, but on the news this morning it said that 5 of the high street banks were poor at customer service, neglected compensation or refunds due to bonuses being given to them if they managed to fob the customer off (whatever means necessary i think including mails that do not make sense and falling on the old "We are legally entitled to charge" even though your homeless and unemployed, legally entitled to charge does not make charging that person the right thing to do) and lack of any interest from any senior bank manager staff.

    the FSA said it will be also heavily fining 2 of the banks, but will that mean that customers like me who were given a raw deal would get any of that fine? Or will it go in the FSA pot in our name and i will see none of it?

    The 5 banks all agreed they needed to do some major overhauling in the customer complaints departments, i hope i get a offer at about £100 or a free complimentary laptop from the bank for all the crap i had off them.

    I could rant all day about all the stuff i had to do with this Lloyds TSB bank screw up that they said was right but i don't have room or time.
    Owed out = lots. :cool:
  • natweststaffmembernatweststaffmember Forumite
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    Smasher wrote: »
    So you lot should vote for me!:idea:


    So you lot should vote for me! :idea:


    So you lot should vote for me! :idea:
    Smasher, as always, bang on.....why comment fuirther, lol!
    I have not worked for NatWest Bank since February 2009

    This username is no longer active.
  • I think there were some good answers here re charges on going over your overdraft limit etc, but one of the biggest problems I see at the moment is the increasing use of banks of charges for using your authorised overdraft. I have just paid my way out of an HBOS account overdraft and closed my account with them - hurray! - but felt forced to do this at a much faster pace than planned due to the horrendous, frankly unacceptable loan-shark level charges they levy on authorised overdraft use (£1 per day). On closing my account I complained about these, and was told by the smirking bank worker, 'Well all the other banks are starting to do this now too.' What are the parties planning to do to stop this outrageous practice.
  • davidgmmafandavidgmmafan Forumite
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    "I would suggest that not all bank charges come from mistakes, but generally living beyond ones means."

    Assuming for the sake of argument that's true, it still doesn't change the debate in the way that you think it does. The way I see it is thus does a bank, indeed any business, have the power to fine its customers? (and indeed should it?)

    That is the current situation, at least councils, police, courts have powers given by LAW. The banks and others with these kind of charges have awarded themselves the right to issue fines.

    Regarding the Halifax charging structure it concerns me greatly that they are imposing these charges on customers who state they do no accept them, yet again attempting to redraft the law in thier favour.

    If all banks do do this then the neccessity of a full investigation into this so called competitive market becomes all the more urgent.
    Mixed Martial Arts is the greatest sport known to mankind and anyone who says it is 'a bar room brawl' has never trained in it and has no idea what they are talking about.
  • natweststaffmembernatweststaffmember Forumite
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    LloydsTSB only charges you interest rather than £1 per day so switching is the choice. NatWest similarly....the question is whether the recipient would allow the transfer in. Sorry, David, but the Halifax charging structure does give you a way out....transfer your account out.

    The Supreme Court decision and the lower court decision does not support that view David, the charges are not fines or penalties and they are not excessive nor can the level be challenged on them. Moot point but let's not go OTT with regards to what politicians are saying since promises are not actions.
    I have not worked for NatWest Bank since February 2009

    This username is no longer active.
  • davidgmmafandavidgmmafan Forumite
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    "Sorry, David, but the Halifax charging structure does give you a way out....transfer your account out."

    I understand that BUT they state if there is a balance owing the customer has no choice. They say they cannot close an account with a balance owing (nonsense they do it all the time) and therefore the customers right to reject the new charging structure is circumvented. I would really like to believe that this was a genuine effort to encourage people to understand that an overdraft is a temporary facility repayable on demand (which I think is something that needs to be done) but I can't escape the conclusion its not about that, or simplicity, its about making mroe money and locking people into a cycle of debt.

    You know my view on the SC decision and the banks flowery language, I don't buy it. There IS an element of punishment in the charges, I have heard this expressed by senior staff members, who suddenly stopped saying it when I pointed out this was the point customers were making.

    I thought the SC ruling was not that the charges weren't excessive rather there was no basis on which to look at this in terms of fairness, which is not quite the same thing.

    I would add to the fines issue that there are many people here who express the veiw that the charges ARE for punishment, and some even argue they should be higher to deter people. I recall a lengthy discussion on this point.
    Mixed Martial Arts is the greatest sport known to mankind and anyone who says it is 'a bar room brawl' has never trained in it and has no idea what they are talking about.
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