MSE News: Applications for Tesco Bank account suspended after MoneySavers' stampede

Nick_C

I find it a bit annoying that although I am a Tesco Bank customer (I have a credit card and savings account and use online banking), I cannot currently open a current account.

I had been holding off hoping for a clubcard signup bonus. This clearly won't be happening now.

I can see why they would suspend new application if they are overwhelmed, but they could have given priority to their existing customers.

colsten

Nick_C wrote: »

I can see why they would suspend new application if they are overwhelmed, but they could have given priority to their existing customers.

Giving priority to existing customers who are umming and aahing over whether they actually want to open an account? Why should they do that? You had the same opportunity to apply as everyone else did, and by the sounds of it, you knew about the account(s) long before the stampede started. It was your decision to delay your application. You gambled, you lost. Take it on the chin.

Nick_C

colsten wrote: »

Giving priority to existing customers who are umming and aahing over whether they actually want to open an account? Why should they do that? You had the same opportunity to apply as everyone else did, and by the sounds of it, you knew about the account(s) long before the stampede started. It was your decision to delay your application. You gambled, you lost. Take it on the chin.

The account has in the past offered sign up bonuses.

It has also been subject to the most terrible data security breaches.

The only attraction of the account, until recently, was 3% interest.

For me, the deciding factor is the additional Clubcard points on debit card transactions in store.

This new feature made me want to open a current account, and switch to Tesco for my main shop.

But because of a rush by people who are not already customers, I am currently denied the chance to open this account.

This does not seem a good way to look after existing customers!

There are lots of factors to take account of when choosing who to bank with. Customer service is one of them. On this score, I am not impressed.

colsten wrote: »

Why should they do that?

Because a good business looks after its existing customers!

jimjames

Davegeo wrote: »

I guess I'll have to open more RBS accounts and find some direct debits that aren't already coming from an RBS account!

You might want to check that before you bother. I'm not aware of any RBS accounts that pay decent interest

Nick_C wrote: »

It has also been subject to the most terrible data security breaches.

Just to clarify this rather exaggerated statement. As far as I'm it was not the most terrible data breach. No customer data was stolen and no customers lost money so I'm not sure it could possibly the most terrible. Bad news for them, yes. Most terrible, probably not.

Nick_C wrote: »

Because a good business looks after its existing customers!

By stopping their systems becoming overloaded with too many applications in one go. I'm not sure how that is hard to understand? I'm a customer and have been for over 2 years. I'd be annoyed if I couldn't get through to call them because they'd taken too many applications. Slowing it down makes complete senses especially when the account isn't new and those applying are on the whole chasing the interest

Nick_C

jimjames wrote: »

Just to clarify this rather exaggerated statement. As far as I'm it was not the most terrible data breach. No customer data was stolen and no customers lost money so I'm not sure it could possibly the most terrible. Bad news for them, yes. Most terrible, probably not.

To quote the BBC report:-

About 40,000 accounts saw suspicious transactions, of which half had money taken.

The bank had to block current account customers from making online payments using their debit card.

The bank confirmed some accounts "have been subject to online criminal activity, in some cases resulting in money being withdrawn fraudulently".

One cybersecurity expert said this could be an unprecedented breach at a British bank. "I've not heard of an attack of this nature and scale on a UK bank where it appears that the bank's central system is the target," said Prof Alan Woodward, a security consultant who has worked with Europol.

Kevin Smith, from Blackpool, said he had lost £500 from one account and £20 from another. He said: "I was just about to go to bed when I received a text message from Tesco saying there had been fraud on my account. So of course you panic."

Alan Baxter, from Berwick-upon-Tweed, said he had lost £600, leaving him with just £21.88 in the bank. He said: "Tesco said they couldn't offer me emergency funds but would offer £25 as a goodwill gesture. "I've got food and petrol to pay for. I have a delivery of coal coming tomorrow for our coal-fired heater and I won't be able to pay."

"Tesco Bank is stressing that relatively small amounts were taken from 20,000 accounts, this is a very serious security incident.
All Tesco Bank will say is that it has been the victim of "online criminal activity" so we have little detail on the nature of the attack. But what is different is that it involves tens of thousands falling victim in a 24 hour period to what appears to be an automated process, rather than individuals clicking on links in phishing emails or having their details stolen after downloading malicious software.

That could involve the attackers exploiting a vulnerability in the bank's website - or even gaining physical access to a branch and then the central systems.

Whatever has happened, the damage to trust in Tesco Bank and online banking in general will be greater than the financial cost."

jimjames wrote: »

By stopping their systems becoming overloaded with too many applications in one go. I'm not sure how that is hard to understand? I'm a customer and have been for over 2 years. I'd be annoyed if I couldn't get through to call them because they'd taken too many applications. Slowing it down makes complete senses especially when the account isn't new and those applying are on the whole chasing the interest

I'm also a long standing customer of Tesco Bank, and a Tesco Shareholder.

I agree that they needed to suspend application from new customers.

I do not agree that they needed to suspend applications from existing customers who have already undergone the necessary credit and identity checks, and for whom new accounts can be opened with minimal effort.

I'm not sure how that is hard to understand?

gt94sss2

Nick_C wrote: »

I agree that they needed to suspend application from new customers.

I do not agree that they needed to suspend applications from existing customers who have already undergone the necessary credit and identity checks, and for whom new accounts can be opened with minimal effort.

Opening a current account needs more checks than would be needed when opening a savings account.

However, I think part of the reason Tesco will have suspended applications will be logistical - how many debit cards etc. they can issue at once etc.

Tesco do like to send quite a but of paper when opening accounts in my experience.

Davegeo

"You might want to check that before you bother. I'm not aware of any RBS accounts that pay decent interest"

I always get RBS and Bank Of Scotland mixed up - I meant the 3% between £3-5k accounts at Bank Of Scotland (which I have three of, but as soon as I tried to set up a standing order from back to my main account were blocked and apparently I have to take photo ID into a blinking branch to unblock...)

As it happens it seems that Tesco are getting through the backlog and I've just received an SMS telling me it's all going through.

Davegeo

jimjames wrote: »

You might want to check that before you bother. I'm not aware of any RBS accounts that pay decent interest

I always get RBS and Bank Of Scotland mixed up - I meant the 3% between £3-5k accounts at Bank Of Scotland (which I have three of, but as soon as I tried to set up a standing order from back to my main account were blocked and apparently I have to take photo ID into a blinking branch to unblock...)

As it happens it seems that Tesco are getting through the backlog and I've just received an SMS telling me it's all going through.

Nick_C

gt94sss2 wrote: »

Opening a current account needs more checks than would be needed when opening a savings account

I'm sure it does. But as I already have a Tesco Bank Credit Card, as well as a savings account, I would expect my application to be easier to process than someone who is not already a customer.

redux

gt94sss2 wrote: »

Opening a current account needs more checks than would be needed when opening a savings account.

However, I think part of the reason Tesco will have suspended applications will be logistical - how many debit cards etc. they can issue at once etc.

Tesco do like to send quite a but of paper when opening accounts in my experience.

Exactly. Trying to increase orders for regular batches of debit cards at short notice, in the middle of other customer regular orders, would be one non-trivial detail. And more brochures, etc.

Nick_C wrote: »

For me, the deciding factor is the additional Clubcard points on debit card transactions in store.

This new feature made me want to open a current account, and switch to Tesco for my main shop.

I didn't realise it was a new feature.

About a year ago I made some modest investments. For those that accept debit cards I used the Tesco one, as it earned a point per 8 pounds even on non-Tesco spending.

It's not a lot, but it's not nothing.