HSBC not providing the student account overdraft facility as advertised and agreed

mat_henry

Hi
My daughter opened a student account last year with HSBC with the £3000 interest free overdraft facility over three years. She chose this account because of this advertised facility. In the first year she had a £500 overdraft. Her account has been managed well and there have been no concerns for the bank to deal with. This year she wished to avail herself of the increased overdraft facility.

She has been declined and has been given a letter that clearly shows that HSBC consider her as wanting to open a “new bank account” and immediately have a “new borrowing”. The person in the branch was the person who set up and agreed the student account with her and he had the details of her account open on his computer. He said the computer had made the decision and he could do nothing about it!

She then raised the issue through her internet banking facility and received what is clearly a standard response saying that HSBC have a series of letters for this situation and whatever the letter she had received that would give the reasons why she was refused. My daughter has now written again hoping to reach someone prepared to look into the matter.

My daughter now needs this extension of her facility up and running within two weeks, as her rent is due each quarter before her loan and any grant arrives. She would incur interest charges on her rent for several weeks if not paid on time. My daughter’s credit rating is “excellent”, but as she has an existing well-managed account, I cannot see this as being a relevant issue.

Is HSBC trying to wriggle out of an agreed facility? What can my daughter now do? There is no guarantee if she changes to another bank that she will get an overdraft facility, although there is no valid reason why she shouldn’t.

Any advice gratefully received.

Cheers

nimbo

there will always be a clause that will state subject to credit rating and T&C's in the small print.

HSBC are well within their rights to turn her down.

has she thought of going to another bank to see if they would be able to open an account with a larger overdraft facility? then closing the HSBC one down?

although there will now be extra foot prints on her credit file... she may get lucky.

good luck getting it sorted.

iAMaLONDONER

mat_henry wrote: »

Hi
My daughter opened a student account last year with HSBC with the £3000 interest free overdraft facility over three years. She chose this account because of this advertised facility. In the first year she had a £500 overdraft. Her account has been managed well and there have been no concerns for the bank to deal with. This year she wished to avail herself of the increased overdraft facility.

She has been declined and has been given a letter that clearly shows that HSBC consider her as wanting to open a “new bank account” and immediately have a “new borrowing”. The person in the branch was the person who set up and agreed the student account with her and he had the details of her account open on his computer. He said the computer had made the decision and he could do nothing about it!

She then raised the issue through her internet banking facility and received what is clearly a standard response saying that HSBC have a series of letters for this situation and whatever the letter she had received that would give the reasons why she was refused. My daughter has now written again hoping to reach someone prepared to look into the matter.

My daughter now needs this extension of her facility up and running within two weeks, as her rent is due each quarter before her loan and any grant arrives. She would incur interest charges on her rent for several weeks if not paid on time. My daughter’s credit rating is “excellent”, but as she has an existing well-managed account, I cannot see this as being a relevant issue.

Is HSBC trying to wriggle out of an agreed facility? What can my daughter now do? There is no guarantee if she changes to another bank that she will get an overdraft facility, although there is no valid reason why she shouldn’t.

Any advice gratefully received.

Cheers

Did you complain to head office?

StacFace

I've checked Martin's guide to Student Accounts and for HSBC it says:
"Guaranteed at least £500 upon opening of account. All overdraft requests are subject to status and assessed on an individual basis."

Therefore she cannot expect to receive any higher. This doesn't mean you can't complain to try and get a higher limit but they don't have to grant it and if they do they're unlikely to go straight up to the £3k. It's well known that only a few people actually get the full amount with student accounts offering 'up to' overdrafts.

She will probably be better off switching to an account with a higher guaranteed overdraft amount. Martin's guide recommends The Co-Op account which guarantees £1.4k in first year, £1.7k in second year and £2k in third year.

Link to guide:
http://www.moneysavingexpert.com/students/Student-bank-account

The_Jakal

StacFace wrote: »

I've checked Martin's guide to Student Accounts and for HSBC it says:
"Guaranteed at least £500 upon opening of account. All overdraft requests are subject to status and assessed on an individual basis."

Therefore she cannot expect to receive any higher. This doesn't mean you can't complain to try and get a higher limit but they don't have to grant it and if they do they're unlikely to go straight up to the £3k. It's well known that only a few people actually get the full amount with student accounts offering 'up to' overdrafts.

She will probably be better off switching to an account with a higher guaranteed overdraft amount. Martin's guide recommends The Co-Op account which guarantees £1.4k in first year, £1.7k in second year and £2k in third year.

Link to guide:
http://www.moneysavingexpert.com/students/Student-bank-account

This is very true.

When I looked for my student bank account I made sure that I chose one that had a guaranteed overdraft amount because even though it was £1000 less than what was on offer from HSBC I knew I would get the full amount no matter what my credit score was.

A lot of the banks use the 'up to' amounts to lure students in unfortunately!