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

JuicyJesus

Also, something else that springs to mind - if your business is run on such a knife edge that £7.50 a month is an enormous deal to you, is it even really a going concern in the first place?

Paulgonnabedebtfree

OK then. I see that there is mention of Santander being allowed to alter their T & Cs - a right that I am in agreement with if changed within the scope of "free forever.". My argument is that the word "forever" supercedes those T & Cs.

Please bear with me while I come at this from a slightly different angle - one that I would probably argue in a tribunal if it were to become necessary:

For a moment, let's put the word "forever" aside.
Let's assume instead that the offer from Santander had been two years free business banking if staying within certain transaction limits. Then, after one year, they announce that they will start charging £7.50 per month from month 14. They use the argument that they may do this as they have altered their T & Cs.
Could someone who is in favour of Santander being allowed to end "free banking forever" say if (a) they think Santander should be allowed to start charging from month 14 and (b) how my fictitious 2 year/14 month scenario varies, in principle, from the "free forever" scenario.
Is my fictitious scenario different because it mentions specific lengths of time? If it is different, at what point between 2 years and forever does Santander's behaviour become acceptable? Please give reasons.

Not trying to catch anyone out here or start a keyboard war. Just using a different scenario in the hope that it makes my point clearer. Also, it's just possible that someone may produce a quality argument that let's me see that I've been in error.

Paulgonnabedebtfree

JuicyJesus wrote: »

Also, something else that springs to mind - if your business is run on such a knife edge that £7.50 a month is an enormous deal to you, is it even really a going concern in the first place?

Point taken but I don't think that's really the issue. For me it would mean merely cleaning the windows at half an average house once a month. I don't believe that Santander would stop at £7.50 either. Their behaviour on personal account overdrafts bears testament to that. After they got away with following Halifax on a per day charge whatever the amount (but less than Halifax), after a while they increased it a lot.
I reckon the real problem here is that due to the Spanish banking crisis, they are trying to repatriate money to Spain. In short, it wouldn't surprise me if Santander are in the brown stuff.

TenThirteen

I have my small business banking with The Co-Op c/o the FSB and I would highly recommend others sign up to it!

I was with HSBC for my first year running the business and because my current account and mortgage was with them they offered me free business banking for the first year. When that year was up it was going to cost me £35/month to keep my business banking with them so I signed up with the FSB specifically to join The Co-Op business banking. I then cancelled the FSB subscription before the start of my second year with them so I only paid the first year sign up fee and subscription - and The Co-Op had no qualms about keeping my account as a free FSB one - and it's been 6+ years since I was an FSB member (sorry FSB!)

Info about the account/it's limits is on The Co-Op website: http://www.co-operativebank.co.uk/servlet/Satellite/1196151412542,CFSweb/Page/Business-CurrentAccounts

Susievintage

JuicyJesus wrote: »

Also, something else that springs to mind - if your business is run on such a knife edge that £7.50 a month is an enormous deal to you, is it even really a going concern in the first place?

I am not sure that this helps our debate. My business could afford £90 a year, but I am not so naive as to think that this is the end of it. The fees will rise, the services will reduce - and the time to make a fuss is now, rather than once the principle of "paid banking" is embedded.

And if you know how to make a business succeed while taking your eye off the many small payments that soon add up, please do tell me and I can stop spending so much time on bookkeeping and money on an accountant!

juliusceasor

JuicyJesus wrote: »

Also, something else that springs to mind - if your business is run on such a knife edge that £7.50 a month is an enormous deal to you, is it even really a going concern in the first place?

It is not the amount but the principle. Metro bank is offering Free business banking as are Coop via FSB and HSBC online only (which incidentally the Santander one is pretty much). I signed up 2005 and put up with a poorly providing (service wise) bank on the basis that there were no costs to operate the bank account, when starting a business that is one less fee to contend with. -Personal current accounts are free and no charges are made for paying cheques or automated transactions, why should a business account be charged differently especially if significant deposits are held there.
Previous business accounts I have had have been free during the years I held them by maintaining an amount £2000 on deposit/ in the current account something I would do prudently to avoid any potential issues.
Santander still made charges and earned fees on CHAPS payments and foreign transactions. As a bank it also holds all the funds in the accounts which it pays no interest on (current account) and pays out significantly less interest than it gains (deposit accounts) on over night depositing it does.
The bank makes money on money, it is just not extra profit it earns when it charges for doing so.

The point here is that the terminology used to entreat was 'free forever', 'Forever' being a very long time. What is at question now is that the bank felt 'Forever' was too long for it and wanted out. It changed via terms and conditions 'Forever' into 2- 4 months and we are where we are.
I think on principle anyone should be rightly indignant that the bank plays fast and loose with the English Language to suit their purposes and should be brought to book for it.
They should have advertised it on the basis it was free for 3/5/7/10 years perhaps and reviewable yearly thereafter. 'Forever' has no connotations of a set time frame and it is wrong of them to intend otherwise.
Debating whether a business is insolvent with a fee added or whether the Bank makes a loss or not is incidental and secondary to the point that the Bank set out to mislead or use to its advantage deliberately misusing a key word in the English Language. Perhaps the legal position would be 'In perpetuity' is longer than 'Forever', that is a valid discussion point. 'Forever' doesn't mean 'forever' to some marriages for example, but to others it does.
The bank is at fault and to suggest that it benefits the client is also another lie. I am clearly disadvantaged now, paying for something I was not paying for and I will see no benefit for doing so, period The benefit is entirely to the Bank.

MJPS

I like many of you phoned Santander's help line and was fobbed off. I asked them to ensure that they recorded my complaint. I am a member of the Federation of Small Businesses and one of the benefits is free banking with the Co-op. The membership fee of £120 per year sounds a lot but one of the many possible benefits is that they will handle an investigation by HMRC if you are unlucky enough to suffer one. As Santander are about to renege on free banking I am in the process of moving to the Co-op. The customer service person who filled in the application forms over the phone could not have been more helpful. I would suggest all 230,000 businesses to look at the FSB website to see if membership is right for them.

stphnstevey

don't have time to read 5 pages, but wld like some alternatives

JuicyJesus

Paulgonnabedebtfree wrote: »

OK then. I see that there is mention of Santander being allowed to alter their T & Cs - a right that I am in agreement with if changed within the scope of "free forever.". My argument is that the word "forever" supercedes those T &

That's not the case. A valid contract supersedes anything else. If you agreed to the terms, you agreed they could change those terms whenever, with the option to back out from the contract (I.e close your account) should they do so.

It is also quite possible that the "free banking forever" advertisement included small print to this effect. I don't know, because nobody as yet has been able to produce a copy of this advert.

cashisking1

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