How will reclaiming bank charges impact banking discussion

Tootsie_Roll

Unfortunately Tim L you have made some grossly inaccurate assupmtions that underpin your argument - Hopefully at some point tomorrow I will have time to respond in more detail.

keith_har

I have a MAJOR concern. All this claiming back of bank charges is all good and well, as we live in the belief that bank charges are massively inflated and to that end, we are able to claim them back.
HOWEVER if banks can prove that them charging 28quid to tell you they are overdrawn is an amicable figure to charge then dont they have the right to claim back there money???
As a result all those people who have claimed thousands of pounds from banks could end up returning there cash, forcing them dramitically into debt.
I really dont understand the legal side off all this very well but what i do know is banks are more than willing to bankrupt people just to get there money back.

What are other other money-savers views on this.

Thanks Keith

davebelushi

a panel of experts were invited to theorise a realistic figure for bank charges on a recent tv program. try as they might, they couldn't get the figure any higher than £2-3. The bank can have their £60 odd quid back from me based on that. But the point is, if an unproportionate charge wasn't levied in the 1st place many people wouldn't have more than a couple of charges to pay back as it is the very high charges that keep causing the arrears.

mrcall1969

Tootsie_Roll wrote:

Possibly the most telling sentence in the article is this - 'We must all learn to behave defensively with our banks, understanding how and when charges operate and modify our behaviour to deal with them'.

As I and many others predicted we are now seeing posts from people who are on at least their second round of recaliming charges as clearly they haven't learned from past mistakes. What many of us who have worked in the banking profession know is that they have most likely been 'offending' in this way for years and will never learn. Together with the re-claimers who have previously included their overdrafts in bankruptcies and are now trying to make a quick buck they are just making a mockery of the whole process.

As I have stated over and over again - it is very easy for everyone, regardless of their financial circumstances to avoid paying charges - all it requires is a little thought and to take some responsibility for your own actions. Sadly as a nation we are dumbing down and trying to remove as much responsibility from our own lives as possible. The re-claim campaign is a classic example of this.

No one is saying that people SHOULDN'T pay charges if they go overdrawn. The thing that people are taking issue with is the extortionate way they are levied!

If the Banks took back what it cost them to administer an account, then no one would have any complaints. That is the crux of the matter, not how often someone goes overdrawn or how many times they have claimed their penalties back.

To reitterate, if the penalties were in proportion to the banks costs, then fine. Quite clearly they are not, so well done to the people who have exposed them.

Graham_Devon

MiserlyMartin wrote:

I agree with Graham. From this is money:"The UK is one of the only countries in the world to still offer free current accounts. Most European counties, America and Australia charge a monthly fee for holding a current account, as well as cheque-handling fees." And this is very true.

Its not very often that I disagree with Martin Lewis, but this is one issue where I can't agree with him. I'm also shocked he is supporting this. The axing of free banking is on par with the axing of free cash machines. Which, by the way could also be another way the banks could get their profits back. Its all very well screwing the banks back, problem is they have power and they can screw you back by other ways. Martin talks about the poor interest offered by banks, this is not so with Halifax and Nationwide current accounts to name just a few great interest paying current accounts. Now those could disappear.

In the USA and Australia - an interest paying current account!!?! A very rare thing. They pay you to have a current account? No, you pay them for the priviledge of having one.

Exactly! I get 0.1% interest on my current account. But I get 5.64% on my savings account.

I can't pay direct debits, I can't withdraw cash etc etc from my savings account though.

I do not see how martin can use this as bate to the argument. Again, this is something that people choose, whether to use a current account with high interest or a current account with practically non.

It's something we have control over and something we can change if we want to. EXACTLY the same as charges. So from my perspective thats an extremely poor argument to back the case.

I think Martins right in a lot of things and enjoy reading his stuff. But I do feel as if he's following what people want to hear here. So would I if I were him. He can't afford to annoy people.

If my links to news stories from the establishments themselves (which I did not get a reply to) were not enough evidence that charges will appear due to this whole compensation thing, then I don't know what is.

joskin69

Hi it's great that so many are reclaiming those hideous charges but are any banks being proactive enough to stop them or at least reduce them to a more realistic £2.50/£4.50? Is there any legislation afoot to make banks do so? Hmm, I know where my money would be!
Jo

bengal-stripe

No! No! No!

nickmack

joskin69 wrote:

Hi it's great that so many are reclaiming those hideous charges but are any banks being proactive enough to stop them or at least reduce them to a more realistic £2.50/£4.50? Is there any legislation afoot to make banks do so? Hmm, I know where my money would be!
Jo

Erm, no. They're still ripping of millions of customers and getting away with it. So until they're forced to or the majority claim, it's likely they'll carry on.

nickmack

keith_har wrote:

I have a MAJOR concern. All this claiming back of bank charges is all good and well, as we live in the belief that bank charges are massively inflated and to that end, we are able to claim them back.
HOWEVER if banks can prove that them charging 28quid to tell you they are overdrawn is an amicable figure to charge then dont they have the right to claim back there money???

'However if' are the key words here. The chances of any bank proving that every charge costs anywhere near £28 in real terms is virtually impossible. The simple reason is, it doesn't cost this. Even with proof of manual intervention in some transactions, they would be hard pushed to get anywhere near this.

Do you really think banks would settle thousands of claims out of court and pay up in full if they had evidence that these were the actual costs?

nickmack

Mark7799 wrote:

I believe the level of charges to be disproportionate to the costs incurred to the Banks. I recall in my banking days seeing a memo saying that the fee included a level of penalty within the calculation to act as a deterrent to customers who abused their accounts.

The charges issue has been likened to theft by the Banks in some cases by posters - all I would say here, if someone was "stealing" £50/100 off you every month, wouldn't you do something about it - both in terms of dealing with the thief and changing your behaviour to reduce the possibility of it happening again ? It needs people to be proactive in looking after their accounts and financial education (as well as lessons in resisting temptation:D )

I'm in agreement with you in principle, that people need to try and get out of these situations where they incur charges.

I refuse to believe that any bank by 'stealing' £50/£100 each month is doing it as a deterrant. If internal memos have indicated a part of the fee is a penalty, then as we already know, it is exactly that. As a financial institution, any suggestion that taking money away from people will help them get out of financial trouble is simply ludicrous.

If banks think they are doing this as any kind of favour to the customer, it shows their complete arrogance and disregard for consumer law in favour of profits.