Bank of Ireland bank charges

leftieM

I have been stunned at the usurious charges here for unauthorised overdrafts. I made a mistake in June - I wrote a cheque and transferred the money from a different account to cover it. However the cheque was cashed a day before the money landed so I was £33 overdrawn for a day. I was charged £14.50 referral, £10.17 for something else and £2 interest. Now, in fairness to BOI, they refunded the charges when we asked them but couldn't explain the massive interest rate (2200% by my calculations!)
The girl on the phone couldn't justify the interest rate. I asked her what it was officially and she said it was 24.9% APR. Really though, they just seem to charge what they like. Yes I made a mistake and yes I should pay - but 2200% interest is outrageous. Even a loan shark would blush!

kellya_3

Let's face facts, all NI banks have been ripping off customers for years and still are!!! The solution is simple, SWITCH to Nationwide or A&L. They offer better interest, better deals and better service. It is a really simple process to move banks and they move all your direct debits as well.

What makes me laugh was the recent Northern Bank current account advertisement that showed a couple at dinner being charged for the fork, knife and table rental. Up until that point their current account would have charged you for everything. What is being offered by Northern has been available for the last 10 years via the mainland building societies/banks.

leftieM

I moved to Cahoot some years ago but kept the BOI to cash cheques in my maiden name and for cheques in both of our names. So at least the 2 quid is about all they've made from my in the last few years!

IvanOpinion

You only paid the charges you agreed to pay if you failed to manage your money properly. The advice is correct though, switch to another bank or building society and get yourself an authorised overdraft if you occasionally dip into the red. Take positive action ... unfortunately we are all about to become losers over this.

Ivan

leftieM

2200% - I'd like to see where in the small print that one was hidden!

IvanOpinion

You don't state how you are manufacturing the figure of 2200% therefore it is hard to say. However banks do clearly state the charges they will make and how interest will be applied .. if you read the small print that you have agreed to you will see that it probably works out .. don't tell me you ignored all the small print when you signed the contract ... tut, tut, hopefully lesson learned for the next time

ivan

leftieM

2/33 = 6.06% for 1 day which is equivalent to (6.06x365)% APR
= 2212%
Okay, it's a simple interest calculation. I couldn't be bothered to calculate compound interest.
In reality I think that if you go into unauthorised overdraft in any quarter they charge you as if you were overdrawn for the whole quarter -that makes the figures fit - 33 x (24.9/4)/100 = 2.05.
Oh well it's cost me £2 to learn to keep a closer eye on my finances. It could have been worse.

IvanOpinion

leftieM wrote:

2/33 = 6.06% for 1 day which is equivalent to (6.06x365)% APR
= 2212%
Okay, it's a simple interest calculation. I couldn't be bothered to calculate compound interest.
In reality I think that if you go into unauthorised overdraft in any quarter they charge you as if you were overdrawn for the whole quarter -that makes the figures fit - 33 x (24.9/4)/100 = 2.05.
Oh well it's cost me £2 to learn to keep a closer eye on my finances. It could have been worse.

You are correct in your second calculation .. which is exactly what their T&C says. Why anybody would ever sign up to such things is way beyond me Have a shop around there are better accounts out there and organise yourself an authorised overdraft (you will still pay small amounts of interest but it will get rid of the charges ... and make sure the overdraft facilty is FREE).

Ivan