MSE News: Big five banks should sell branches, says Ed Miliband

Lokolo

pinkdalek wrote: »

How about new banks/competitor banks opening new "stores" rather than replacing an existing branch? Take the RBS/Sanatander example, how does this increase competition when one bank (RBS) is being replaced by a Santander branch, which already happens to have a branch in the same town? With some of the Lloyds branches are these just not being replaced so in effect there is no extra competition just a replacement bank?

Most towns now are full of charity shops and the high street is dying a death. A bank isn't competitive just by the fact it has a branch, what the dopey labour politician doesn't realise is that banking now is very much online/telephone as well as branch.

If he wants to make banks more competitive and increase jobs, then why not have it so the UK banks have to have their call centres in the UK, their admin offices etc.

This is from the party whose government closed 100s of post offices and also allowed Lloyds to take over HBOS despite it going against all the rules of the monopolies commission.

I agree with a lot of it, but I suppose the bigger question is - who can afford to do this?

If I suddenly started sh**ing money, I would quite happily open a bank, it's one of things I'd actually find quite fun I imagine!

Paul_Herring

It would appear Mr. Milliband has found another bandwaggon to jump onto.

Such a shame he didn't have such thoughts when he was actually in a position to put such things into practice.

I suggest that this will be all forgotten by Milliband when either

1) The next bandwaggon comes rolling along that he can jump onto or
2) The next election

whichever comes first.

pinkdalek

Lokolo wrote: »

I agree with a lot of it, but I suppose the bigger question is - who can afford to do this?

If I suddenly started sh**ing money, I would quite happily open a bank, it's one of things I'd actually find quite fun I imagine!

Well they can afford to spend money on hosting the Olympic Games and in theory they would have money to spend had England been given the World Cup in 2018.

MisterOweAye

I'm waiting for who is going to raise the big issue - the end to free banking.

'Free banking' relies on misleading the customer and selling poor quality financial products to pay for running bank accounts. Examples of this are:
- PPI
- Bank charges
- Rubbish packaged current accounts
- Expensive mortgage rates
- Expensive credit cards
- Paying 0.1% on positive balances
etc

It should be illegal to offer a bank account at below cost - eg free. Benefits claimants should be able to set up a basic account via the post office.

As I say it's the big unspoken issue in the UK banking industry. I bet no party will tackle the issue head on.

Rafter

MisterOweAye,

I'll probably be in a minority agreeing with you.

Personally I think an active, elecronic only account that allows you to withdraw cashback or from your own banks ATMs should be free as long as you use your debit card at least once a month or have direct debits set up or a minimum balance of say £500.

Otherwise people have to realise that writing and processing a cheque costs £1+ paying in cash in a branch probably £3+ when staff time, security, rent etc is taken into account and it is probably wrong that less financially savvy people who incur charges are subsidising their account. In retailing it is called loss leading selling a product below cost but somehow in banking and financial services it is absolutely fine!

As for the hairbrained idea that selling branches that are expensive and used by less and less of us somehow helps competition maybe Mr Milliband should have spoken up when his party were smashing together Lloyds and Halifax in the last parliament and allowing Santander to hoover up Abbey and Alliance & Leicester.

R.

callum9999

Rafter wrote: »

MisterOweAye,

I'll probably be in a minority agreeing with you.

Personally I think an active, elecronic only account that allows you to withdraw cashback or from your own banks ATMs should be free as long as you use your debit card at least once a month or have direct debits set up or a minimum balance of say £500.

Otherwise people have to realise that writing and processing a cheque costs £1+ paying in cash in a branch probably £3+ when staff time, security, rent etc is taken into account and it is probably wrong that less financially savvy people who incur charges are subsidising their account. In retailing it is called loss leading selling a product below cost but somehow in banking and financial services it is absolutely fine!

As for the hairbrained idea that selling branches that are expensive and used by less and less of us somehow helps competition maybe Mr Milliband should have spoken up when his party were smashing together Lloyds and Halifax in the last parliament and allowing Santander to hoover up Abbey and Alliance & Leicester.

R.

Of course it's fine - it's a completely different concept...

Loss leaders get you in to buy other products - accounts with no monthly fee are not really loss leaders. While the end result may be the same, the profit is made from customers mis-using their existing accounts, not them being tricked into buying other over-priced items.

And while I do sympathise with the ignorant to an extent, and there should definitely be safe guards in place, it's no good breaking your terms and conditions then moaning that it's unfair. If it's unfair, don't sign up in the first place.

psychic_teabag

MisterOweAye wrote: »

I'm waiting for who is going to raise the big issue - the end to free banking.

'Free banking' relies on misleading the customer and selling poor quality financial products to pay for running bank accounts.

But even if banking wasn't free, wouldn't they still mislead customers and sell poor-quality products, in order to make additional profit ?

pqrdef

Rafter wrote: »

when his party were smashing together Lloyds and Halifax in the last parliament and allowing Santander to hoover up Abbey and Alliance & Leicester.

You mean, rescuing what could be saved from the car crash created by the Tories allowing demutualisation of building societies?

Paul_Herring

pqrdef wrote: »

Rafter wrote:

when his party were smashing together Lloyds and Halifax in the last parliament and allowing Santander to hoover up Abbey and Alliance & Leicester.

You mean, rescuing what could be saved from the car crash created by the Tories allowing demutualisation of building societies?

Labour in power: 1997
HBOS takeover: 2009

I don't think you can blame anything like that on the tories after 12 years of Labour rule.

Especially after Mr Brown's continual "No more boom and bust" rhetoric between 1999 and 2007 when he was chancellor.

Thrugelmir

pqrdef wrote: »

You mean, rescuing what could be saved from the car crash created by the Tories allowing demutualisation of building societies?

Plenty happened under Labour's watch.

Regulation of NR and B&B, not to mention Halifax merging with BOS.