MSE News: Santander to charge for 'free' business accounts

Susievintage

"230,000 Santander business customers with free current accounts will soon be hit with a monthly charge..."

Read the full story:
Santander to charge for 'free' business accounts

This is the discussion from the original thread 'Santander introducing business banking charges':

When I started my business in October 2003, I opened a business bank account with Abbey National, when they were offering "free business banking forever". They have of course been taken over by Santander, and I have maintained my account.

I have today received a letter from Santander, saying that "later this year" they will transfer my business account to their "award-winning £7.50 fixed monthly fee account". I have several questions:

1. Do I have a leg to stand on with Abbey's promise of "free business banking forever", as trumpeted all over the application paperwork that I still have?

2. Is £7.50 a month (which sounds a lot to me, at £90 a year) what a business account costs?

3. Can anyone recommend a free (or free-ish) business account - all I do it pay in cheques (no more than six a month) and make BACS transfers (I am a business trainer), so it's not a busy account or one that needs fancy facilities.

Many thanks for thoughts on any of the above.

gt94sss2

Susievintage wrote: »

1. Do I have a leg to stand on with Abbey's promise of "free business banking forever", as trumpeted all over the application paperwork that I still have?

Unlikely, they can change the terms and conditions/charges at any time - with notice.

3. Can anyone recommend a free (or free-ish) business account - all I do it pay in cheques (no more than six a month) and make BACS transfers (I am a business trainer), so it's not a busy account or one that needs fancy facilities.

Consider the HSBC Business Direct Account - its free as long as you stay within certain transactional limits - and designed for companies which mainly do telephone/internet transactions.

Regards
Sunil

robind

Hi, I have also now been told "Free forever" means £7.50 a month forever.

Santander have a "Dedicated help line" on 0845 606 1721 to handle these complaints - but they simply fob you off with pre-typed excuses.

1. Ring them and raise a complaint (which they are very happy to do) about the service provided by the help line.

2. If they suggest you visit their cost comparison site, look at it and note that it only shows banks usually more expensive than Santander. Raise a second complaint about the cost comparison - make it clear you want to raise TWO complaints.

3. Ask the adviser how the charges benefit your business in this "time of economic crisis" - They will have no useful answers.

As the "dedicated help line" has been worse than useless, call:
0845 600 6014 - the Santander complaint line. Here you can make a complaint about the dedicated help line that it is "not fit for purpose". Clarify you are complaining about the help line itself - not the account change.

4. Spread the word! - Let's get as many people complaining and making formal complaints as possible...

5. When Santander respond to formal complaint for the expected fob-off reply, choose to "Escalate to the ombudsman"

Each internal and external complaint costs the bank money. This should help them understand the difference between FREE and CHARGES. Once they understand this and what their entering into a contract to provide "Free banking forever" means to their customers then they MIGHT understand the error of their ways (ever hopeful here..)

But if they don't, the Co-op Business banking looks about half the cost of Santander and their customer service can't be as bad as Santander, can it?

If they want to waste out time and money and renage on their contract - we can COST THEM MONEY and GET A BETTER DEAL.

It's time to get even with the banks - start registering complaints today!

Bobz

I'm hoping that those of us using the free business banking with Santander can claim the right to 'free business banking forever', despite the change from Abbey to Santander. After all, if it had been employees whose employer had been taken over by another company, then any significant changes to their contract of employment could be challenged. Why should a banking relationship be any different?

I don't want a 'new, improved' account - I just want to be able to pay in cheques (around 10 per year) and make direct payments out (again, probably 10 per year - it is for part-time earnings) without having to pay £90 per year for this service.

There has to be someone who can advise us of the legality of this move.

robind

We should all start raising formal complaints ASAP to raise awareness at Santander... They we all TOO keen to tell me how many clients were calling in about the change and happy about it...

gt94sss2

Bobz wrote: »

I'm hoping that those of us using the free business banking with Santander can claim the right to 'free business banking forever', despite the change from Abbey to Santander. After all, if it had been employees whose employer had been taken over by another company, then any significant changes to their contract of employment could be challenged. Why should a banking relationship be any different?

Changes - even when someone is your employer cannot always be challenged - if they have given you sufficient notice of the change. Its your choice whether to accept these changes or leave.

I don't want a 'new, improved' account - I just want to be able to pay in cheques (around 10 per year) and make direct payments out (again, probably 10 per year - it is for part-time earnings) without having to pay £90 per year for this service.

As per my previous post, consider the HSBC Business Direct Account - its free as long as you stay within certain transactional limits..

Regards
Sunil

cottager

Susievintage wrote: »

2. Is £7.50 a month (which sounds a lot to me, at £90 a year) what a business account costs?

NatWest business a/c
We pay:
40p for each outward DD and payment (BACS or online Faster Payment), and ATM cash withdrawal
71p for each cheque written
22p for each auto-receipt (c/card, Faster Payment, BACS)
76p for each manual credit (paying-in slip)
35p for each cheque banked in that credit
66p per £100 (or part) for cash banked
£3 for each Faster Payment arranged via the branch
£6 per month a/c maintenance charge

Depending on number of transactions and amounts involved, we're generally paying £40+ per month charges. We do have a secondary ex-A&L (now Santander) business a/c purely for paying in cash which I do at the local PO, as it's free up to £3k/month and then their charge per £100 is a bit less than NatWest; that's all we use it for, with the equal amount then being banked into the main a/c at NatWest.

coldhandoff

cottager wrote: »

Depending on number of transactions and amounts involved, we're generally paying £40+ per month charges. We do have a secondary ex-A&L (now Santander) business a/c purely for paying in cash which I do at the local PO, as it's free up to £3k/month and then their charge per £100 is a bit less than NatWest; that's all we use it for, with the equal amount then being banked into the main a/c at NatWest.

You could probably save money if your account was on a different tariff.

Susievintage

Thank you all for your help and suggestions.

I have phoned my local Santander corporate banking team, and they were surprised to hear about this. They have phoned head office, and come back with confirmation that charges are being introduced, and there is no exception for those of us previously promised free banking forever.

I pointed out that the letter is vague about when the charges are coming in - my letter says "later this year", which could logically be tomorrow. The chap I spoke to said that the notice period is usually 30 days, so we'd better get a wriggle on with changing our accounts.

Meanwhile, I will be complaining as suggested above.

Susievintage

gt94sss2 wrote: »

Unlikely, they can change the terms and conditions/charges at any time - with notice.

Consider the HSBC Business Direct Account - its free as long as you stay within certain transactional limits - and designed for companies which mainly do telephone/internet transactions.

Regards
Sunil

Sunil, I'm a bit confused. I've checked this HSBC account, and have found this: https://www.business.hsbc.co.uk/1/2/business-banking/business-bank-accounts/business-current-account/free-business-banking-explained;jsessionid=0000yhoBoWujledUpBWYoI7xnHV:12c5gttgs

This says that they offer "6 months free business banking for Business Banking switchers with a turnover below £500,000" - so it's free, but only for six months, and "at the end of the free business banking period... you will automatically move on to the tariff of your chosen account". Is that what you expected?

cottager

coldhandoff wrote: »

You could probably save money if your account was on a different tariff.

So I now see... thanks
'Could' being the operative word -- I'll need to do some detailed comparisons for several months' past charges, but the Auto Free could be better as we have almost daily BACS credits (from c/card merchant) and the bulk of our payments out are online Faster Payments, which we can use as OH is a sole trader.

On the other hand he does still regularly write some cheques every month, quite a few of our customers also still pay by cheque (at least a couple every week if not up to half a dozen), and we draw cash weekly from the ATM. The charges for all these are higher.

Also considerably higher for banking cash, and many of our customers do pay cash. Most months it'll be close to the A&L/Santander £3k free limit, and some months it's more, when they charge 50p/£100 for the excess. If they lowered the limit (as they have once already from £4k/month since becoming Santander) or removed it altogether, and/or imposed a monthly charge for the a/c as the OP has indicated (we haven't had anything from them about this so far), it may not be worth continuing with it. Then we'd be back to banking cash at NatWest unless we could find another place which handled it more cheaply.

If it all went back to NatWest, then an average of £3k's worth of cash monthly would add practically £30 back onto the charges straight away... although I guess that would happen whether we changed tariffs or not, and at least with the free transactions on the Auto Free tariff it might not be too much higher than now.

Hmmmm... some serious calculations to do! But many thanks for pointing it out.

Would changing tariffs involve any "interruption to service" in terms of using online banking or my mandates to operate the a/c on OH's behalf (or anything else), or is it merely a separate behind-the-scenes admin change, which affects nothing else at all? It would be very serious at certain times, and we'd have to time it carefully, if it caused any interruption to being able to use online banking for instance -- payments for weekly wages, settling monthly supplier accounts and PAYE, quarterly VAT etc etc.

[Susie: sorry to hijack your thread with my questions!]