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

janusdesign

DruidDonagh wrote: »

@janusdesign: ING for me was the worst experience ever when it comes to banking.

I had personal savings with them years ago, and never had a problem... only left as their bonus rates last twelve months and then plummet to near nothing.

having said that, been well over ten days since I applied online and nothing has come through the post... not too bothered as I was only treating it as a saving option - it's more important to me to find an alternative to Santander for day-to-day banking.

Monkeyfish

I haven't received a letter about this but I assume I will do.

This is really annoying since my company is semi-dormant at the moment whilst I work on various ideas and research and only pays out £10 here, £50 there.

Is it legal to have a Ltd company and just make and receive little payments from your personal bank account instead?

janusdesign

Monkeyfish wrote: »

Is it legal to have a Ltd company and just make and receive little payments from your personal bank account instead?

well i'm no lawyer/accountant, but legally isn't a limited company an entity in its own right, it's not you personally.

most t&c for personal bank accounts will say you can't use it for business purposes... they usually mean sole traders, where you are working as yourself possible under a business name.

I don't think it would be illegal as such, but it could make the accounts awkward to manage... I suppose you could get around it by treating your bank account as petty cash in the accounts, but it'll get messy... you're probably better off just getting another bank account for the company - so far, I think HSBC and RBS are free.

gavcooper

Anyone already moved to HSBC business banking would like to recommend me, maybe we can split the £50.

http://www.business.hsbc.co.uk/1/2/business-banking/recommend-hsbc

tjcmills

All, if you really, really want to ensure a big company doesn't get everything all its own way - then you just need to write a complaint directly to Santander (using email or the online complaint form), then once you've received their response, escalate the complaint to the Financial Ombudsman.

EVERY complaint raised to the Ombudsman will cost Santander £500.

That will dwarf the revenue they hope to raise from our monthly fees and may make them think twice about it if the complaints begin to escalate.

janusdesign

tjcmills wrote: »

EVERY complaint raised to the Ombudsman will cost Santander £500.

That will dwarf the revenue they hope to raise from our monthly fees and may make them think twice about it if the complaints begin to escalate.

if they only receive a few complaints, they can easily take the hit from FOS fees, if everyone complained (not going to happen), then the hit is £100m+ - but having then taken the hit, unless ordered to by FOS (almost certainly not going to happen), there's no incentive to continue the "forever free" option... so it's a one-off hit to close a loss-making service, they'd write if off and move on with a profitable (I assume) business... even though their profits halved to €1.7bn this year, they've got bigger things to worry about than these accounts.
i'd love to feel optimistic about this, and I have no objection to sending off a complaint, but I just don't see Santander changing their minds on this... either there is a good business/legal model for what they're doing (I can see the business sense), or it's a crazy idea that Santander would have corrected quickly once they saw the response from their customers - and they haven't done that.

to quote from the FOS web site..

"Q: does the ombudsman punish or fine businesses?
A: No. Our job is to settle individual disputes between consumers and businesses providing financial services – where consumers think they have lost out. We do not write the rules for businesses providing financial services – and we do not monitor (or regulate) businesses to make sure they follow the rules. This is the responsibility of the regulators – for example the FSA or OFT."

so I don't think on a practical basis FOS can do anything other than hit Santander £500 per complaint... it could prove useful if enough people complained that the FOS passed it up the chain to the FSA or OFT to deal with.. but how many would be "enough" I don't know... FSA would probably fine, but OFT have more teeth - but it would be a long process.

if we all complained today to Santander, we couldn't make a formal complaint to FOS until October (assuming Santander took their time in replying), by which time we would likely have already received the 60-day notice letter for the charges to begin.

as I said, i'm happy to join the fight - but someone has to provide hope that there is any point in doing so, short of being petty and hitting Santander with a £500 fee per complaint.

Roccket990

I have the letter, they have replied & the reply is more or less identical to the original letter. So now it's next stop a letter to the FOS. I don't expect we will win, but if it costs them £500 that's just fine & dandy by me!

Incidently, the Co-op's BusinessDirect plus is free for 18 months,then £3.00 per month. Then as long as you keep £1000 in the black, & pay in under 100 cheques per month, you only pay 25 pence per payment made. (cheaper than a 2nd class stamp!)

For me that works, as I only have one or two payments to make each month.

Jerry

Wizpeters

Like many others I strongly urge everyone affected by this change to make a complaint to Santander and then take it further.

I received a reply today from Santander to my original letter of complaint about the proposed change of conditions, stating that "we can make changes to your account by giving 60 days notification of any changes taking place"

Again like many other people who have commented I am no legal brain but it seems to me that the terms and conditions may be a red herring, in that I have a letter from Abbey National Business dated 28 March 2003, this is pre-opening of my account, it is an offer to me to open an account, this letter under its first bullet point offers "free banking forever", so far as I can see it does not say anywhere in the two page letter "subject to terms and conditions" or any other terms that have the same or similar meaning.

Final thing, as well as the Ombudsman, which is a definate option why not get in touch with Vince Cable, the Business Secretary, he is a man with no great love of banks and has sympathy for small businesses, which in this case are being hit again by banks

Victor_Mildrew

if we all complained today to Santander, we couldn't make a formal complaint to FOS until October (assuming Santander took their time in replying), by which time we would likely have already received the 60-day notice letter for the charges to begin

I complained by phone(0800 100801) last week & received a standard "tough luck, go to the Ombudsman" letter today. I phoned the Ombudsman (03001239123) today & after several questions (dates, etc.) they gave me a reference number & are sending me an official complaints form. The person I spoke to seemed to have not heard about Santander's proposal.
Watch this space:mad:

magpiecottage

It actually costs Santander £500 per case at FOS, not $300.

However, what we are relying on is the fact that Abbey National provided a guarantee. FOS indicated in November 2001 that it would expect a firm to honour guarantees - see here. Although this relates to mortgage endowments, the principle should still apply.

It gave further guidance on this here.

Ombudsman News 50 also addresses these issues. In particular, it says " It may be that, with hindsight, a firm wishes it had included a particular term. But unless that term was properly incorporated into the contract we will not apply it."

You can also download the final version of the Business Banking Code here. Note section 2 says "We will make sure that our advertising and promotional literature is clear and not misleading". To say "free forever" and not mean it is unclear and is misleading.