The other side of the coin: The case for bank charges

Bamber19

JohnPeard wrote:

If you were to repeat this, referring to a bank rather than a customer, then this would be libelous. Many of the people on this site, and others, have no money in their accounts precisely because they banks have unlawfully removed their funds in the first place. It might be useful to add that 'the jury's still out on this' but since all the banks seem to be avoiding defending their position, it has proved impossible to get this tested in court.

The banks are taking out the money 'unlawfully' in response to the theft i am describing. People have absolutely no right to spend money that is either not theirs or for which there is no agreement in place to allow for it. Admittedly i feel sorry for those who go 23p overdrawn and get hit by a £30 charge but they should learn from it not get into a situation like many are in now where they've just not given a damn and racked up costs (which many have paid without complaint as they have accepted them as a part of their contract with the bank) and now looking to claim back thousands of pounds. If i stole an item from a shop i wouldn;t expect to get away with it just because i intended bringing it back at some point in the future.

JohnPeard wrote:

Woh! I thought it was the principles of democracy (people's power), adhesion to the law and those that produce the food and goods we need that define what we are. As for 'keeping it running' those who have lost their homes, their businesses and jobs because of the ammoral way banks have operated in pursuit of profit would find your comments deeply offensive.

Well one of the goods and services that people seem to need is banking, i could turn what you said on it's head and say, what about the immoral way people are living their lives? In pursuit of a standard of living well beyond what their means are capable of sustaining. Many people lost their homes and businesses because, well, for homes, they got a mortgage they could only just afford provided interest rates didn't rise at all, but they don't think the bank should be allowed to expect them to keep to their side of the bargain and pay every month. Business is a risk, people don't go out of business purely because of the way banks are, if you go into any business unaware that their is a risk it will all go wrong then you have only yourself to blame when it does.

MPH80

inmypocketnottheirs wrote:

Some very interesting posts from Hubert Dalrymple. I would summise, in essence, that as the banks are looking to introduce/increase charges because of the curtailment of the penalty charges, that this indicates that they have been making a profit from levying them.

The death penalty is illegal here in the UK.

Doesn't stop us having a debate about whether we should have it or not.

The start of this thread was 'should we have bank charges?' - not are they lawful or not.

To say "They aren't lawful - so that rules them out" stifles the debate because laws and civil law can be changed. So let's get into the morality of them ... let's get into the rights and wrongs and lets actually debate how banking should be funded.

M.

inmypocketnottheirs

MPH80 wrote:

The death penalty is illegal here in the UK.

Doesn't stop us having a debate about whether we should have it or not.

The start of this thread was 'should we have bank charges?' - not are they lawful or not.

To say "They aren't lawful - so that rules them out" stifles the debate because laws and civil law can be changed. So let's get into the morality of them ... let's get into the rights and wrongs and lets actually debate how banking should be funded.

M.

Read my post number 12 on this thread then. I have said hopw banking should be funded. The whole point of a debate is that as the 'conversation' moves along other points can be made. Unless of course MPH they dont concur with yours?

JohnPeard

You have it in one InmyPocket!

I have re-read your post #12 and you are absolutely spot on.

Any other method results in a lack of transparency, diversions and - dare I say it - unlawful means of raising revenue.

Hubert_Dalrymple

I find it extraordinary that people are effectively saying that they would like the status quo to remain in place so that they can continue to enjoy free banking, even though that is (apparently) not profitable for the banks.

Why are you so resistant to paying appropriately for the service you receive? Why on earth should you rely on others to pay for you? Of course it is not particularly pleasant but it is transparent and fair. What is not is hanging onto the coat tails of those who are frequently the very least able to afford it.

Hubert_Dalrymple

Further, to call going over your overdraft limit or being unable to pay a DD "theft" is quite grotesque and completely inaccurate.

Banks are in a position very easily to control exactly how much money flows out of an account and to prevent any from going out if they so desire. In my case, every single one of my charges was simply for a returned DD and the only times I exceeded my overdraft were when the charges were added.

Moreover, this is a contractual relationship. In any breach of contract there is a standard way of seeking the remedy of the breach: asking the party who has breached the contract to put it right.

If money really is taken from the bank in a way which they consider to be inexcusable and outside the terms of the particular contract, and asking for it back does not yield the desired results, then the bank has a very simple way of seeking to recover it: filing a claim in the County or High Court and then enforcing the judgment (if necessary). Involved in both the request and the judgment would be any costs and expenses legitimately incurred by the bank in recovering their debt.

To seek to put in place a legal system in England where the defaulter under a contract can be penalised would mean that our whole system of civil and commercial justice would undergo a fundamental shift. No longer would the courts only be seeking to rectify damage and put the parties in the position they would have been in if the breach had not taken place: they would become involved in invoking punishment. This would be not only to change our civil justice system into a penal system, but also to permit people other than the state to impose punishment. This is fundamentally wrong, in my opinion. And utterly unjustified and unjustifiable.

MPH80

inmypocketnottheirs wrote:

Read my post number 12 on this thread then. I have said hopw banking should be funded. The whole point of a debate is that as the 'conversation' moves along other points can be made. Unless of course MPH they dont concur with yours?

Fair enough - personally - don't have time to go back over every post in a thread and I don't remember everything everyone wrote.

So - read post #12. Would be interested to know what you considered fair charges for each of those items.

Since they are services - banks are, of course, free to charge what they like for them. Couldn't it result in mobile phone style contracts? (e.g. get £50 worth of debit card transactions for £20 a month)

It also interests me how we then push this on forward. For example - on a 'per transaction' basis - given most retailers are charged a percentage of a transaction - could the same basis be applied to consumers? Would the bank then move the transaction cost from retailer to consumer in order to encourage the retailer to take their card? (I could see AmEx taking this route in particular).

Having said all that, I'm not sure per transaction is a likely result - it's, in my opinion, just a bit too far from the current setup. As I said in my earlier post - I think the banks will come up with a range of current accounts involving a variety of offerings. I do worry about more complaints along the lines of banks 'excluding' people from banking services.

My problem with these debates - and hence my move to bring it back to topic is that they always result in a spat over whether or not the charges are lawful or unlawful. That's getting very very very old now.

M.

JohnPeard

Hubert_Dalrymple wrote:

Further, to call going over your overdraft limit or being unable to pay a DD "theft" is quite grotesque and completely inaccurate.

Banks are in a position very easily to control exactly how much money flows out of an account and to prevent any from going out if they so desire. In my case, every single one of my charges was simply for a returned DD and the only times I exceeded my overdraft were when the charges were added.

Moreover, this is a contractual relationship. In any breach of contract there is a standard way of seeking the remedy of the breach: asking the party who has breached the contract to put it right.

If money really is taken from the bank in a way which they consider to be inexcusable and outside the terms of the particular contract, and asking for it back does not yield the desired results, then the bank has a very simple way of seeking to recover it: filing a claim in the County or High Court and then enforcing the judgment (if necessary). Involved in both the request and the judgment would be any costs and expenses legitimately incurred by the bank in recovering their debt.

To seek to put in place a legal system in England where the defaulter under a contract can be penalised would mean that our whole system of civil and commercial justice would undergo a fundamental shift. No longer would the courts only be seeking to rectify damage and put the parties in the position they would have been in if the breach had not taken place: they would become involved in invoking punishment. This would be not only to change our civil justice system into a penal system, but also to permit people other than the state to impose punishment. This is fundamentally wrong, in my opinion. And utterly unjustified and unjustifiable.

There are fewer examples where the fundamental truths have been expressed so eloquently. Very, very well put Hubert !

inmypocketnottheirs

I will no doubt be accused of supporting hubert dalrymple's post because his views agree with mine. I just wish I could be so accurate and knowledgeable.

With regards to MPH comments, banking used to be on a pay per transaction basis. What is wrong with that?

I like your analogy MPH to the contract mobile phone, pay £x per month for Y amount of transactions. That would result in each bank competing against each other to get the business, in exactly the same way as the mobile phone providers do.

olly300

inmypocketnottheirs wrote:

I will no doubt be accused of supporting hubert dalrymple's post because his views agree with mine. I just wish I could be so accurate and knowledgeable.

With regards to MPH comments, banking used to be on a pay per transaction basis. What is wrong with that?

I like your analogy MPH to the contract mobile phone, pay £x per month for Y amount of transactions. That would result in each bank competing against each other to get the business, in exactly the same way as the mobile phone providers do.

Mobile phone companies have been found to have colluded on some prices so banks would if they started charging per transaction.

I've lived in a European country where you where charged per transaction. A colleague of mine worked out the difference of the combinations i.e. you get a certain amount of transactions free then you are charged, or you pay a lower transaction charge. He concluded that for most people the banks charged the same amount as everyone used their debit card freely and there where no cheques.

However my banking charges worked out between £2 and £3 a month this was a mixture of direct debits, ATM transactions and using a debit card. Transfering money via the internet was free. Sending money over to the UK cost about as a third as much as sending money over from the UK. It took a day to send it to the UK bank while the UK bank took 5 days to receive it. I didn't send any money from the UK to where I was because the UK charges where so high. But the if I did I could have received the money in 3 days rather than 5, and the foreign bank would have charged about £4 for the priviledge of receiving the money rather than the £15 the UK bank charged me.

However I didn't get any interest on the current account. If I wanted interest I would have had to transfer money to a savings account with the same bank.

I don't know what overdraft charges where but I've not been overdrawn since 1994. The reason for this is until about 6 years ago my UK bank refused, when I didn't have an agreed overdraft, to let me be overdrawn. So if I tried to pay with my debit card when I had no money in my account the transaction would have been declined in the shop or where ever. If I tried to pay a direct debit with no money the transaction would be declined, I would get a letter and a £13 charge. And yes I had a Switch card for that account and a cheque book not a electron card or a solo card. After a few declined debit card transactions in shops I learnt to keep a close eye on my account balance -It's embarrassing to have to dig out your credit card or get a friend to pay for you.

Unfortunately the bank who did all this customer service went down the pan when they took over another bank which was the original bank I changed from in 1994. Their charges also increased to match that of the bank they brought. So I changed banks again.

Do I think bank charges could be fair even though I have not paid much of them? Yes if they are low.

Unfortunately the UK system is a profiteering one where the banks charge people as much as possible where they could either stop people spending the money by refusing to honour it like in my case, or ensure that when a payment and a debit are suppose to go through on the same day the payment doesn't come out first causing someone to be overdrawn. Even though I've not been overdrawn I've actually seen my wages in my account but not properly debited to it 2 days before hand on internet banking plus other odd things.