HSBC £25 overdraft arrangement

AlexisV

I've had an HSBC account for about 10 years with a £1250 overdraft (apart from the first few years when it was £750).

Every year I get a letter reviewing the overdraft and every time it seems to be a generic template just approving the arrangement for the next 12 months.

This year though I was hit with a £25 arrangement fee, which appeared on the statement the next month.

I rang the bank and they said it was because I'd used the overdraft more in the previous year than I had done previously.

I'm not too bothered but was just wondering whether people though they were acting fairly. In particular, I'm quite disappointed that this year's letter, or any previous ones, did not specifically state there would be a £25 charge in the main body of the text. It was hidden in the booklet of T&C's.

I know they're lending me money, but I was a bit surprised at the lack of transparency.

noh

I don't agree that there is a lack of transparency.
The charge is listed in their fees and charges document.
http://www.hsbc.co.uk/1/PA_1_5_S5/content/uk/pdfs/en/90030_9_bankacctcards_trav_q1_new_web_jan.pdf

The £25 fee should only be charged if you have requested an additional overdraft in the previous 6 months by way of a formal or informal request.

So the question is have you exceeded or increased your authourised overdraft limit in the previous 6 months?
If yes the fee is justified.
If no then it should not have been charged.

izools

Have HSBC actually "Arranged" an increased overdraft in conjunction with this fee?

If not, it has been charged in error.

The Fee is for "Arranging" an overdraft. From what you wrote, it was already in place, already "Arranged", using it more is irrelevant, whoever you spoke to has fobbed you off. Escalate the issue and don't take their [EMAIL="!!!!"]!!!![/EMAIL].

noh

izools wrote: »

Have HSBC actually "Arranged" an increased overdraft in conjunction with this fee?.........

The fee is charged for arranging an overdraft it doesn't matter if it's increased decreased or the same as before. The duration of formal overdrafts is 1 year and they are rearranged annualy.
The fee is waived if there has not been a overdraft arrangement made within the previous 6 months.

From their fees and charges document.

"HSBC Fair Fees policy
We always aim to be fair in the way we
charge for our services, therefore:
• We will not charge an Arrangement Fee
provided that, within the last 6 months, we
have not agreed to a request from you for an
overdraft.
• We will not charge an Arrangement Fee
for an overdraft request of £10 or less.
• We will not charge Arrangement Fees for
informal overdrafts if covering funds are paid
in before the end of the day.
• We will give advance notice before Arrangement
Fees are debited from your account.
• If debited Arrangement Fees (or interest)
cause your account to go overdrawn or further
overdrawn we will not make a further charge.
• Arrangement Fees charged will never
be higher than the overdraft requested "

izools

Yes exactly so if the OP has been subject to an annual review period but hasn't manually requested an ammendment to their limit in the preceeding six months the charge is incorrect, irrespective of whether they "use it more".

The "You've used it more" excuse is pathetic and a poor show from a badly trained, incorrect, customer service advisor.

noh

izools wrote: »

Yes exactly so if the OP has been subject to an annual review period but hasn't manually requested an ammendment to their limit in the preceeding six months the charge is incorrect, irrespective of whether they "use it more".

The "You've used it more" excuse is pathetic and a poor show from a badly trained, incorrect, customer service advisor.

I agree the reason given is incorrect.

The charge would also stand if the OP had made an informal request (not just "manually requested") in the previous 6 months ie had gone over their arranged overdraft limit.

izools

Although OP stated that his OD limit has been £1250 for nearly the whole 10 years he's held the account.

Going off this information, there wasn't a change in the preceeding six months and there wasn't a change as a result of their annual review of his account.

Ergo, incorrect charge. Assuming the OP is accurate, that is.

Lokolo

izools wrote: »

Although OP stated that his OD limit has been £1250 for nearly the whole 10 years he's held the account.

Going off this information, there wasn't a change in the preceeding six months and there wasn't a change as a result of their annual review of his account.

Ergo, incorrect charge. Assuming the OP is accurate, that is.

Just because his limit is £1250 doesn't mean he hasn't gone over though.

Given this is the first year he has had the £25 charge I wouldn't be surprised it is correct, only because the charge was introduced some years ago. (although saying that I wouldn't be surprised if it was a mistake!)

izools

The only reason I say it may have been a mistake as both my OH and I have been charged it by mistake - I when reducing my limit from the one they gave me with the account, and my OH by requesting £200 - the only OD he's ever requested

Lokolo

izools wrote: »

The only reason I say it may have been a mistake as both my OH and I have been charged it by mistake - I when reducing my limit from the one they gave me with the account, and my OH by requesting £200 - the only OD he's ever requested

Yeh there has been quite a few threads on it about mistake charges and I know it used to happen, but this is the first one I've seen in quite a while which is what gave me the thought that the wrongly charged bit was fixed.

Guess we'll find out if the OP ever comes back!

noh

Yes it all hinges on whether the OP has exceeded his authourised overdraft limit in the previous 6 months.