Unexpected letter from Tesco... closing my DD account

MABLE

As many of you know Tesco will write off a balance of £1 or less if your credit card balance for the month is below that figure. No doubt because its costly to administer a DD for that period. So based on that if you are only setting up a dd for £1 per month its just not cost effective to Tesco.

However there may be other reasons why Tesco came to the conclusion for terminating OP account.

Graham1

Might be a good idea to tick the box "I'd like to go paperless" in the preferences section as that reduces their costs a bit and might make account closures less likely. I expect they still send a letter whenever a new linked bank account is added so their postage bill must get quite large and many accounts must be unprofitable.

Kendall80

My 50p DDs are probably at risk then. Think i'll up them. Thanks to the OP for the heads up.

joeblags

upped myn from £2 to £5 , I only just opened myn last week so no DDS have yet gone to the saver account.

SevenOfNine

I considered it too cheeky to set up £1 D/Ds so I use both my Tesco current accounts & the internet saver to cream off roughly all the monthly interest from my other current accounts elsewhere, no D/D is less than £7

When I feel like it every 2 or 3 months I move it from the Tesco accounts because the internet saver is rubbish interest & the 2 current a/cs are maxed out so no additional interest on the incoming D/Ds.

Taking advantage of the DD facility with Tesco is one thing, but taking the p! ss is another, can't say I blame them for starting to take a harder line & let's hope it doesn't get even stricter.

Some charities accept £1 D/D if you don't mind being inundated by junk mail & nuisance phone calls, & are feeling generous.

planteria

yes, i think all we can learn from this is to either use the accounts 'properly', or at least make them look a bit more like it.
using them as 'main' Bank or Card Provider doesn't appeal though, i must say:think:
and yes, YB, i reckon you are likely to survive the cull;)

YorkshireBoy

SevenOfNine wrote: »

When I feel like it every 2 or 3 months I move it from the Tesco accounts because the internet saver is rubbish interest & the 2 current a/cs are maxed out so no additional interest on the incoming D/Ds.

They could also be looking at those who spend most of the month sat with £1 balances, so shifting out as soon as it arrives (which is what I used to do!) may leave you 'exposed'.

So, going forward I think I may even increase my Lloyds DDs to, say, £50 each and then just remove £30-40 a month thereby letting the balance increase slightly over time (which could be another thing they're looking for?). Then once a year have a tidy up. Pretty easy to cover the additional DD value from Lloyds by increasing the monthly SO credit from £1,500 to c. £1,550

I'll also cancel the DDs I set up to pull from Santander 1-2-3 (I know they're not required to pull, but I did it for 'set up and forget' reasons to avoid dormancy issues), as they're not needed now all my utilities/communications DDs are on there.

Halifax Reward (x3) will need some tweaking though. I'm thinking I may run these with a £20 float, thereby enabling larger value DDs to be pulled to Tesco (just one from each as the other is covered by Egg Savings (now with YBS).

Ed-1

Dizzee_Rebel wrote: »

Hi all,

I opened a Tesco Internet Saver around a year ago, the same time as switched from Barclays to Halifax for the reward & to use Tesco as one of the direct debits. I manually pull a pound each month via Pay Pal for the other DD.

Two months ago I opened a Club Lloyds Account, set Tesco to pull a pound from this, aswell as Halifax on the same day & I use Pay Pal as the other.

Just come home from work & received this letter:

"We, Tesco Bank have recently undertaken a review of the banking arrangements that you have with us. We have, with regret, reached the conclusion that we will no longer provide these facilities for you.

Consequently, you will need to make alternative arrangements within 30 days of the date of this letter.

Unfortunately, we will not be able to provide references for you.

If you have not made alternative arrangements within 30 days of the date of this letter, then any credit balance remaining in you account will be returned to you in the form of a cheque.

We assure you we only reached this decision after careful consideration."

Anyone received anything similar? Or know of any other savings accounts that I could use for the other DD.

Thanks.

Same letter received today for me and OH. :eek:

Question is why 30 days notice when it says they'll give 2 months notice of closure in their terms and conditions?!

I'm starting to get concerned that "money saving" is going to get us banned from each bank one by one...

karlie88

Ed-1 wrote: »

Same letter received today for me and OH. :eek:

Question is why 30 days notice when it says they'll give 2 months notice of closure in their terms and conditions?!

I'm starting to get concerned that "money saving" is going to get us banned from each bank one by one...

Did you both have current accounts with them? And were they £1 DDs?

Thank you.

Ed-1

karlie88 wrote: »

Did you both have current accounts with them? And were they £1 DDs?

Thank you.

Direct debits ranged from £3-£5. Recently opened a couple of donor current accounts which were switched to Yorkshire Bank back in Feb but just the 2 savings accounts open now.