Lloyds Bank Debit Card Frustration

swshaun

Hello there folks,

I am having issues with Lloyds Bank and debit authorisations and usage, and wondered if someone can set me straight as I get a different answer each time I phone up Lloyds and am getting quite brassed off.

So... I have a few current accounts, one for bills, one for my own spending, the hubby's own spending and out food and clothing.

Save for the billing account, the other three I top up weekly to help me budget on a week-to-week basis. The reason for this is that, when the money runs out, then the debit card gets declined, so then I pay using the billing card where all of the money is, and make a note on the budget and reduce future weeks allowances accordingly.

Now, until the last month or so, this worked fine -- when there was no money in the account, the card would be declined, and I would pay using the billing card.

However, this week transactions have been authorised whilst the account is in debit which surprised me!

We opted out of contactless as they do not show up in as pending, so are harder to track, and opted to keep chip and pin.

My question is : for chip and pin, how is it possible to authorise a transaction on an account with no overdraft facility which is already overdrawn by a £15.62? I was allowed to go £33 over, and then got a letter.

Something I counted on for budgeting (card decline) is now no longer working.

I was told that for transactions under £15, there is no authorisation sought by Lloyds. I was able to make a transaction for £27.29 today which takes me £5.99 overdrawn.

To my mind at least, this is a way of manufacturing back charges! I want to be responsible and keep my nose clean, but it seems the banks are making it harder to do that!

agrinnall

The answer is always to be aware of what you have spent from which account and make sure yourself that you don't go overdrawn, rather than place total reliance on computer systems.

TheShape

Someone will be along to explain the specifics but it is the case that many transactions occur 'offline' ie they are not checked against your account balance at the time to ensure you have cleared funds.

Your accounts clearly have an overdraft facility. What you don't have is an authorised overdraft.

If you have managed to avoid overdraft charges for a significant period when spending over and above your account balance then you have been fortunate.

Your account/card t&cs would have explained the ability to go overdrawn so it's something you should have been aware of.

Your next statement will show a charge for being overdrawn but your bank may refund charges for a 'first offence' so it is worth asking them to do this.

swshaun

I know the ultimate answer is to account for every penny -- I am surprised that the transactions are being authorised when they were being declined before as recently as a month ago, just strikes me as sneaky more than anything else.

However, for no other reason than it would be informative and intrigue, I would like to know how transactions get authorised.

I opted out of contactless for chip and pin so that I could see the transaction follow through the system -- it leaves a footprint, so to speak, and therefore aids with budgeting.

Shakin_Steve

When we applied, and got, our Tesco bank account we did not apply for an overdraft. I noticed in the T&C's that it said that they may allow a payment to go through that would take us into overdraft, at their discretion. No doubt we would incur a charge so, basically, it's up to us to keep an eye on available funds.

molerat

I am afraid the only answer is for you to manage your money rather than leaving it to chance and the bank. I am surprised that you have managed to escape this situation this long.

I have managed with a spreadsheet going back to the 70s when to spend on a card involved the old zip zap machine and paper receipts which took days to get to the bank, good old pencil and paper back then, computerised now. It is easy to do and, although I have made up my own to suit my particular needs, many templates are available on line.

Planning what you are going to spend and when is budgeting, spending until you run out of money is not.

System

swshaun wrote: »

I know the ultimate answer is to account for every penny

I opted out of contactless for chip and pin so that I could see the transaction follow through the system -- it leaves a footprint, so to speak, and therefore aids with budgeting.

Ask Lloyds to issue you an online debit card (for the account in question) this will always require authorisation. At BOS, these are called 2 in 1 Ultra cards and Lloyds will probably use the same terminology.

newfoundglory

You'd be better of with a basic bank account, where no overdraft is available.

Because many payment authorisation requests (even with online cards, where there is insufficient balance) treat it as an application for an unauthorised overdraft - and you will be charged fees.

Some banks offer a service where you can request payments are declined, but this feature often has a fee.

Therefore, a basic bank account which does not charge fees for this would be the best option.

GingerFurball_2

If debit card payments are being authorised when there are no funds then that's down to how the retailer has processed the transaction.

Dobbibill

GingerFurball wrote: »

If debit card payments are being authorised when there are no funds then that's down to how the retailer has processed the transaction.

This is spot on. Some retailers do not tell the bank if the transaction is below the floor limit they have.

Either change cards as suggested or set up text alerts to notify when your balance drops to a certain amount.

takman

Are you really happy with a system that means you spend money until the card declines?.

I would personally recommend using some notes on your phone or an app to record spending. You can write down each time you spend money from each category and know exactly how much you have left to spend. You can then keep all your money in one account.