Why have I gone overdrawn on a solo account?

jus71_2

I thought the idea of a solo account was that it was just a basic bank account. I paid for some things through Paypal via ebay and it has taken the money out of my account earlier than expected (about £15) so I went overdrawn by £8. Just checked online and they have charged me £38 in fees:eek: Is it worth ringing them up about it?

Thanks

RayWolfe

Never spend money before you have it, particularly if you are running as close to the wire as you are.

jonesMUFCforever

MY opinion is that if you ring up and query they are just as likely to cancel your solo card and issue you with a cashpoint only card as to refund the charge.
You say yourself that you spent money through Paypal - if it was not available as cleared funds on your account then it should not have been spent.

Your decision!

stiffnuts69

i echo everyone's thoughts however if its the first time you have done this then you can ring up the bank and ask them to refund the charge as a gesture of goodwill (be polite) they usually do in those circumstances where you have gone a little overdrawn and its your first time for doing so and ordinarily the account is well run.

SPANIEL36

Firstly, If You Ring Up They Will Not Cancel The Card And Issue You With A Cash Point Only One. As Far As I Was Aware (cuz I Use My Solo Account With Paypal) The Money You Pay Via Paypal, Leaves Your Account Straight Away So Technically Its Your Fault You Went Overdrawn If You Knew Your Funds Weren't Enough. The Bank Have Charged You This Money As They Have Let The Payment Go Thru. If They Wanted To They Could've Denied Payment And Charged You The Money Too. I'd Still Look Into Claiming Back The Charge Though!!!

smithja

hi, ejones999 and spaniel are not correct. The system in place for retailer of any type requires that they follow the specific procedures for each card type, well it is actually their merchant service that do this in the main, althought there are expections. In the case of SOLO and Visa Electron, this requires authorisation is confirmed from your bank for the transaction to go ahead, at which point the bank removes that value from your available balance, and when the transaction is presented to the bank, the values match, the debit is made, and the authorisation will be removed. In this case, it is either that the merchant did not follow the correct procedure for dealing with a SOLO card, this allows the issuing bank to return the payment, unpaid, it is the same with Visa Electron (and any other card were the merchant did not follow the handling procedure, and it resulted in the account being a state they bank dont like, I have seen plenty people have guaranteed cheques bounced when they were properly guarantee, as the bank was chancing it to stop the debt getting bigger, but the people to who the cheque was made out could simply issue a small claim against the bank for the money if they can prove they followed procedure, which could happen if your transaction was returned). Or alternatively it could be that the bank did not deduct the value from your avaialbe balance, and this allowed you to spend the money unwittingly, as you presumed that as all SOLO transactions require authorisation and a reduction in available balance, so that you cannot go overdrawn. It could also be that both case occured. Either way, the bank is obliged to refund the charge and do one of two things. Return the payment unpaid, or ensure in future that all SOLO card transaction immediately reduce your available balance, the authorisation system is an on-line, real time system, as are the banks now. It is their responsbility to follow the guidlines, and you should not have been charged. If they dont refund the money, tell them you did not give authorisation of your account to overdrawn and that you wish proof that the transaction was handled in accordance with procedure or that they made an error with your available balance, which is their fault not yours. Years ago I had a LloydsTSB Visa Electron card and whenever I used it the available balance did not drop, this went on for month, and I queried this with the branch manager, who did not beleive me. Until I showed him two receipt for transactions that morning and my balance and avaiable balance were the same, the card was cut in two and reissued, as I could have went out and spent the £3000 in my account over and over and over again in the two days before the first transaction took the money. It can be the case that on the banks computer system the card is not properly linked to the account, and it might be worth asking for a new card with a new number to ensure this does not happen to you again. I find it odd that people who work in banks dont know how merchant services work, and the rules governing card acceptable, chargebacks, etc. Hope you find this helpful. James

dobbie82

I thought they were only allowed to charge £12 these days?

natweststaffmember

smithja- a quick thing, some shops have floor limits which will authorise payments regardless of available funds.
Dobbie82- OFT said they would not take the banks to court on credit card charges if banks charged a maximum of £12. Doesn;t make £12 legal though.

smithja

Hi natweststaffmember, the floor limit for an Electron or SOLO card is always zero, they always have to be authorised. Call Streamline and ask, they will tell you the bank is prefectly within its rights to return the SOLO card payment unpaid, if the procedure was not followed to the letter. If it was their own system not working, by reducing the available balance, then they should not be charging a customer for their error. It could also be the case that they got authorisation and did not present the transaction within the specified time frame, causing the authorisation to drop off, and giving the bank valid reason to return the payment. James

smithja

It is the whole purpose of SOLO and Electron card, to save banks the liability for people sending money they dont have. The can return the transactions. James

mrmajika

smithja is corret in that Visa Electron and Solo cards have £0 floor limits. Under 18s are allowed electron and solo cards and so no type 'credit' is allowed to be given, hence the reason they ALWAYS authorise and earmark the available funds.

I believe that the OP might have had a problem that was not in relation to a SOLO transaction.

To the OP, did the Ebay / PayPal payment come out by direct debit? This could be what's caused the problem.

You could have had 'earmarked' funds on the Solo card pending as the direct debit came out.