MSE News: Barclays plans overdraft fees shake-up

Former_MSE_Helen

"Barclays is reviewing overdraft fees and charges as it plans a major overhaul to rid itself of 'any sins of the past' ..."

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Barclays plans overdraft fees shake-up




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stclair

I think this is a great idea giving customer more time to put there account back in order:

Overdrafts are now under formal review following feedback from customers that they want greater understanding of the associated charges. Text alerts for those over their overdraft limit have already been piloted since July, informing customers that they have a day’s grace to add cleared funds and avoid the charge. So far, over 65,000 customers have avoided charges totalling over £1.4m. As a next step, the bank will review other areas in which text alerts can be implemented.

http://www.newsroom.barclays.com/Press-releases/Barclays-announces-new-customer-commitment-following-Your-Bank-launch-aa3.aspx

TurnUpForTheBooks_2

This is fascinating, especially the mention of the Barclays "Personal Reserve" wheeze in the same breath as "sins of the past".

Is that an admission that Personal Reserve has had effects on large numbers of customers similar to those suffered by customers of Payday lenders i.e. encouragement to borrow at effective rates of interest which turn out to constantly ensure that you remain in queer street once you sink that far?

If you convert the £22 per week into a notional interest rate on typical low limit personal reserves amongst the customers on low incomes who struggle the most, then I think that rate has been shown to be absolutely outrageous. This is especially so when you consider that the customer did not even have to borrow his entire Personal Reserve in order to fall foul of next week's £22 charge. All that customer had to fail to do was to extract themselves entirely out of the Personal Reserve trap (by paying back every last borrowed Personal Reserve pound perhaps) before the end of the week. If the customer left but one foot, or one toe even dragging in their personal reserve at the start of the next charging period, then whack - there was another £22 charge, even if the customer paid it off the next morning having realised their mistake.

Sins of the past how many years is that?

My aged parents were given personal reserve just like almost all existing Barclays account holders - some ten years ago was it? They have never had an overdraft in their life. They never had a clue what Personal Reserve was and never will - in fact most people will ever be able to explain it. It was one of those wheezes dreamed up by those clever people ...

So then - will all those damaged customers who got caught in the trap and couldn't get out of it until they contacted CCCS/Stepchange.org (who incidentally seem miraculously to be able to negotiate a freeze on further charges in almost every case) now be contacted in writing direct by the bank to receive compensation like they said they would with PPI?

Oh wait! They never did contact everyone did they? But 5,000 Claims Management companies got let loose on the telephone networks and all of us instead ! That's QE for the masses ! Keeps a good few thousand of them employed on the phones too !

I shall therefore now await my first Overdraft Fee misselling scandal claims management cold call (or text) with interest :rotfl:

Shrinkwrap

Barclays refused to even discuss an overdraft facility until I had 'not overdrawn' for 6 consecutive months. Bank of Scotland withdrew my overdraft facility (of £400) because I had never used it and said it was Government Policy instruction for 'responsible lending' and they could not revoke it.

Its like the emergency services saying saying: "we are removing your fire extinguisher because you have / have not *[delete as necessary] had a fire in the last 6 months."

Jenbeam

Think it's disgraceful to charge £3 a day if you are overdrawn over £2000!! Especially when they don't give you enough notice to clear your overdraft!! It's an extortionate rate compared to other high street banks!!

madnad

I agree, I am constantly within my overdraft and its £2100, so will be paying more for this. I have looked at changing my current account and the nationwide seem the best from advice on this website. What annoys me, is I have been with them for over 25 years, have a barclaycard, barclayloan and will now be giving extra interest on the overdraft. They dont appear to care about the customers.

dr_adidas01

Jenbeam wrote: »

Think it's disgraceful to charge £3 a day if you are overdrawn over £2000!! Especially when they don't give you enough notice to clear your overdraft!! It's an extortionate rate compared to other high street banks!!

What do you mean not enough notice they have given at least 5 months notice that this was going to happen they notified people back in January that they were going to change the fee structure and introduce the new charges in June.

Its not our fault if you don't read the letters and leaflets they have sent out about this!!

dr_adidas01

madnad wrote: »

I agree, I am constantly within my overdraft and its £2100, so will be paying more for this. I have looked at changing my current account and the nationwide seem the best from advice on this website. What annoys me, is I have been with them for over 25 years, have a barclaycard, barclayloan and will now be giving extra interest on the overdraft. They dont appear to care about the customers.

Would it not be better to look at your finances and see what you can cut back on, so that you could reduce the amount of your overdraft that you use and eventually get to a stage where you don't need to use it?

Living in your overdraft can be very dangerous they could decide to remove it without little notice and demand that you repay it immediately, which we have seen happen to many forum posters.