MSE News: Banks agree to code to help limit overdraft charges

NorthernStudent

You perhaps need to look a little closer


http://www.lloydstsb.com/current_accounts/classic_and_classic_plus_accounts.asp

We were talking about Barclays accounts?! I would say looking in Lloyds TSB was looking much farther away!

Chrisblue1962

Here's my solution....

For every current account set up a parallel savings account upon which no interest is gained. Into this savings account, a person can from time to time deposit small amounts of unused cash to build up a personal contingency fund, upto say £50.00, only accessable via the current account.

In the event of there being insufficient funds in the current account to honour a transaction, the bank can, using the Offset rules, draw funds into the current account to cover the transaction.

• Account holder avoids becoming overdrawn, thus avoiding non-payment of transaction and overdraft charges.

• Bank has money in savings account, which it can lend out, thus mitigating cost of running current account.

If the transaction exceeds the balance in the contingency fund, normal bank charges would apply as the account holder has knowingly exceeded the contingency fund balance.



A Win Win situation?

tifo

Chrisblue1962 wrote: »

set up a parallel savings account upon which no interest is gained.

In the event of there being insufficient funds in the current account to honour a transaction, the bank can, using the Offset rules, draw funds into the current account to cover the transaction.

A Win Win situation?

It won't work.

Banks only offset when it comes to THEM receiving payment. They won't offset to save YOU any charges. Why should they?

I'm in the scenario you suggest (but have two current accounts) and last month I forgot to leave enough funds for a DD, by a few pounds, in one account whilst the other had plenty in (hundreds). Guess what the bank did? Return the DD and charge me an unpaid item fee. Why didn't they offset a few pounds from my other account? Because they won't do this .....

The same bank has, in the past, offset money from my current account (much needed money) to pay their credit card account (without my permission). After they did this a few times, I closed the credit card account.

As a rule, I don't bank with the same bank for credit card, mortgage and current account. That way they can't offset.

My branch will be changing banks. When they do this, i'll be closing the current accounts because my mortgage is with the bank that's moving in.

IrishGypsy

c-m wrote: »

While it's all very well stating that users should manage their accounts better (and they should), often card transactions can take days to be presented to the bank and deducted.

Are we to reconcile our accounts after every purchase?

Ideally, yes. we all should. No need to spreadsheet it all, but actually knowing that you have a card payment still unclaimed will keep your account in check. At the end of the day, apart from a bank being a business trying to generate profit, they're also not our babysitters of our money. We're all responsible adults and we should keep a close enough eye on our money like adults.

How we handle our money is our responsibility, not the banks...

2sides2everystory

Our money ? :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: