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

Justdesserts

I too have just received my 'Sod off' letter, i.e generic response which fails to address any of the issues I raised but tells me I feel that I have been miss-sold the account (which I don't!)

FOS ,form completed and sent

magpiecottage

I have thought about this further. I recommend all businesses receiving the letter from Santander make clear in writing that they do not accept the change and that, in accordance with the law as established in Carlill v The Carbolic Smoke Ball Company, they do not permit Santander to debit the account for a monthly fee.

This will in turn mean that any attempt by Santander to do so will amount to an unauthorised payment. If it happens, you can demand that the payment is reversed in accordance with FSA rule BCOBS 5.1.11R(2).

Santander will refuse but you can then take them to FOS.

If necessary, you can do this every month.

magpiecottage

I have gone back through this again.

It seems to me that our accounts are, in effect, governed by two contracts not one.

The first is the obvious one - the terms and conditions. Santander is seeking to rely on that.

However, because of the Carlill case, a separate contract was created when we responded to the advertisement. This is based on the principle of offer - "You open an account with us and we will give you free banking forever" - and acceptance - we opened the accounts.

There is a third requirement, the "consideration". This has to be something with a monetary value. Santander might attempt to argue that there is none. However, the reality is that it uses our money when we do not and, although it pays a nominal amount of interest, this is less than it would otherwise pay on the money markets.

This means that, although Santander is right in saying it can alter the first contract, it cannot alter the second.

It is therefore the second contract that we are seeking to enforce, not the first.

cashisking1

deleted by user

magpiecottage

I agree.

Note that we are not arguing misselling. The remedy for misselling would be simply to put us into the position we would have been in if we had not opened an account with Santander/Abbey National in the first place - that would be the equivalent to Mrs Carlill getting back the ten bob she paid for her carbolic smoke ball.

Like her, though, we are arguing that the contract must be honoured.

We are not private customers but business customers. However, the FSA's rules do not generally distinguish. They use the terms "customer" and "client". There is no distinction between the rights of a private individual and those of a "microenterprise".

Of course one of Carbolic Smoke Ball Company's (failed) lines of defence was that Mrs Carlill had not conveyed acceptance of the contract to it. That is irrelevant here because we all completed and posted an application form.

tim441

I have complained to both Santander & Ombudsman.

In the meantime i am looking into alternatives.....

I see 3 options:

1. Co-Op ... free if i join FSB (which i dont really want to do)

2. HSBC has a free direct banking
http://www.business.hsbc.co.uk/1/2/business-banking/business-bank-accounts/business-direct-account

3. RBS too
http://www.rbs.co.uk/business/current-accounts/g1/direct.ashx

looks to me as if the RBS account has the least restrictions and will probably suit me. I dont have any cash to payin and most debits can be done by internet & credits are by BACS with a handful of cheques to payin

any other ideas/comments?

cashisking1

deleted by user

magpiecottage

Actually, I am not sure that there is a need to add money to the account - merely maintaining a balance should be sufficient.

But our quarrel is with Santander, not one another.

Blank_Reg

Just got a reply from my local MP. He actually says he "100% agrees" with the points we are making. Prior to his election he also had a small business, and banked with the Alliance and Leicester because of the promise of 'free banking forever'. So he appreciates the issue, and would have been in the same situation himself.

He has promised to raise this issue as I requested, and will let me know the results.

So sometimes it IS worth raising these issues

janusdesign

tim441 wrote: »

I have complained to both Santander & Ombudsman.

In the meantime i am looking into alternatives.....

I see 3 options:

1. Co-Op ... free if i join FSB (which i dont really want to do)

2. HSBC has a free direct banking
http://www.business.hsbc.co.uk/1/2/business-banking/business-bank-accounts/business-direct-account

3. RBS too
http://www.rbs.co.uk/business/current-accounts/g1/direct.ashx

looks to me as if the RBS account has the least restrictions and will probably suit me. I dont have any cash to payin and most debits can be done by internet & credits are by BACS with a handful of cheques to payin

any other ideas/comments?

Well I don't want to join FSB either, so the Co-op is ruled out.

I have the signup papers for HSBC, but still haven't completed them - will likely go with them, as the branch is only around the corner... I sent off another customer cheque on Wednesday to Santander and it still isn't in the account... fair enough, the bank holiday will delay it by a day, but I suspect it won't be visible until the end of the week...

so the option in the future of being able to pop round the corner and deposit in cheque in person is very tempting.

when you apply to HSBC online, they'll ring you back within 2 days to go through the application (think its probably just money laundering rules and making sure you're a real business)... they ask about turnover and warn you about international payments... they also told me, they would call every 3 months to see how the business is doing!

I moved to RBS Business Direct in 2000 and got free banking for a couple of years, then after a long email conversation with them they extended it until 2003... I then moved to Santander with their promise of free banking forever!

I don't recall any problems with them - they weren't great, but they were better than Santander... you can email them instead of waiting to speak to someone in a call centre.

actually, it seems everytime i've moved accounts it is because they intend to introduce charges... and off we go again! :mad:

someone previously mentioned a fourth option of a "Business Instant Access Deposit A/C" with Santander... it's obviously not a current account but a savings account, so you won't get a chequebook - but you would get a card to access the ATM... whether you could use it to receive online payments from clients, I don't know - it's almost implied, but perhaps someone who has setup an account can confirm... I don't think you can deposit cheques or cash in-branch with this a/c, so they'd have to be posted or via ATM.

the biggest downside for me is that it's Santander - and I feel that on a matter on principle I shouldn't open an account with them while this fee-free banking problem is ongoing.

oh, I should also point out that HSBC and RBS will charge a fee for International Payments... that caught me by surprise during the HSBC call, think she mentioned £6.50... I can think of at least one of my major suppliers that is based in North America - but I can get around it by paying them by credit card instead, though it's not ideal.