Alliance & Leicester - money paid in but still charged

MarkyMarkD

Whilst HSBC won't charge you, that probably doesn't mean that they might not already have bounced the DD/cheque/whatever. But I may not be correct about that.

YorkshireBoy

gt94sss2 wrote: »

Last time this was discussed, I think someone said Yorkshire also had a similar policy to HSBC re: end of day balances.

That was me Sunil.

I have a Yorkshire Bank current account (very old account - not the new current account plus), and credits are always processed before debits. My current account 'next day transactions' are processed at around 23:00 to 23:30 each night. At that time I can see the credits for the next day (cheques due to clear and BACS direct credits coming in) and can action my 'bill payments' and 'funds transfers' - taking care to set the date for tomorrow, and not leaving it at the default setting of 'today'.

At first I thought my large overdraft facility was covering the payments I initiated, but having moved £10K using the above procedure I was able to confirm that they do indeed process credits before debits and do not (temporarily) use the overdraft.

MarkyMarkD

When people say "xxx bank processes debits before credits", they are almost always missing the point.

I believe that almost, if not all, banks do this with automated transactions. But they don't do it with cash paid over the counter, or transfers from other accounts with the same bank initiated on the day, which is why they say that funds have to be there by close of business on the previous working day.

I've never heard of anyone having a DD bounced on their pay-day, for example, if they are paid by automated credit.

But I'll happily be proved wrong if anyone can tell me otherwise.

gt94sss2

MarkyMarkD wrote: »

Whilst HSBC won't charge you, that probably doesn't mean that they might not already have bounced the DD/cheque/whatever. But I may not be correct about that.

I think they 'reserve' the right to bounce something - but I think it depends on the value of the transaction or debit balance - hence 'most' transactions are not stopped. (I don't know exactly how HSBC decide)

The best thing to do of course is to have an authorised overdraft set-up large enough to cover any potential temporary deficit and then top-up by the end of the day, so no transactions will bounce and no interest is payable..

Regards
Sunil

Milarky

But A&L go further than most (all?) banks in requiring cash paid in the same day to be treated as a 'cleared' item. If you deposit £100 you can draw it out again immediately but if you attempted to make a onward manual (bill) payment with it it wouldn't work - for two reason actually

1) the cash would not be treated as 'cleared' for one working* day

2) you can't physically instruct A&L to make a 'same day' payment - even if you are in funds

Whilst it is standard to process automated payments at the start of a daily cycle - and so have to rely on unused overdraft facilities to cover these - before transferring or crediting cash the next day - what makes A&L an exception to the equally standard practice among banks of the ability of customers to make bill payments without the need to give notice?

I do wonder what will happen to these 'Spanish customs' when same-day bank-to-bank payments go live next May? Other banks will be fine - because they do not hold up payments - but A&L will as things stand still require 24 hours notice to make a transfer from one A&L account to another or to make a payment out of an A&L current account in favour of a payee. Now will 'A&L' credit card make allowance for this I wonder? Of course they won't

Thus A&L actually scores lowest of any of the banks for me - because the ability to send a payment is essential

*So I had to pay my money in for my regular saver - due for transfer on Tuesday, yesterday, Friday

YorkshireBoy

Milarky wrote: »

...but A&L will as things stand still require 24 hours notice to...make a payment out of an A&L current account in favour of a payee.

My Halifax HICA seems to operate in the same way Milarky.

MarkyMarkD

Milarky

I think you might be exaggerating the one-day notice thing with A&L.

If you telephone A&L you can transfer money to another individual's A&L account same day - indeed, instantaneously.

If you pay cash into your account today, it shows as available on Internet Banking immediately, and hence you can instruct a bill payment today - can you not? That bill payment will then arrive on the fourth working day because the money doesn't actually leave A&L till the next working day and then takes the standard 2-day BACS cycle time. I don't think that the extra day you talk about is to do with a 1-day cash clearance time, but due to the standard "extra A&L day" for BACS transfers out.

I'm 100% certain that the "extra A&L day" will have to disappear when faster payments become standard across the industry.

I don't see the relevance of your regular saver example - unless you are making the regular saver transfer manually. If it was a recurring transfer the money would have had to be there on Friday with any bank (other thank maybe HSBC).

The "extra A&L day" doesn't bother me at all. Unless you are disorganised or living hand-to-mouth, it's easy to allow an extra day for the few BACS transfers I make. DDs aren't affected. The interest cost of the extra day is trivial.

YorkshireBoy

MarkyMarkD wrote: »

If you pay cash into your account today, it shows as available on Internet Banking immediately, and hence you can instruct a bill payment today - can you not?

No you can't...

26.6 If You pay in cash over the counter at any Alliance & Leicester branch or through the automated system at the Post Office®, the money will normally be available so that you can withdraw it on the same day. However, You must allow at least one clear Working Day from the time We receive the cash before You use it make any payment (such as Direct Debits, standing orders, bill payments or cheques).

http://www.alliance-leicester.co.uk/currentaccounts/ec03964.pdf

Sagaris

That's unfortunate! We're in the throes of changing our joint back account from Abbey to A&L - my Oh's salary has gone in ok but my employer tells me they need over 3 week's notice from payday to change my bank details! OH's work just swapped his over there and then with 3 days till pay day.
So I'd best make sure they don't change over any DD's etc until towards the end of the month, as all my DD's come out on the first - and I get paid on the last day of the month - so even if I took cash out from Abbey and put it in the A&L account to pay the DD's the following day, it still wouldn't be in time.
Phew!

MarkyMarkD

YorkshireBoy wrote: »

No you can't...

http://www.alliance-leicester.co.uk/currentaccounts/ec03964.pdf

Whilst it may say that, I don't believe it. All three payment types mentioned other than bill payments are automated payments and the condition would make sense. It would also make sense for pre-entered bill payments (i.e. where you say on 20 August that you want to pay a bill on 25 August).

But it doesn't make sense for bill payments which are done "on spec". At the point the payment is instructed, the funds will be available and I can't believe for a moment the payment won't be made without any problems.

If, YB, you've experienced a payment of this type being rejected or been charged for it, I'd like to hear it.

Otherwise, I still don't believe you whatever the Ts & Cs say - I am sure they are just designed to capture pre-entered bill payments.