£100 Arrangement fee - What is it?

Mike12421

Hello all, its been a while since I posted last, but I have a new problem. I have just checked my online HSBC current account,
and found the following charges are due to be applied;

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Charges and debit interest incurred for banking services
From:04 Sep 2007To:03 Oct 2007Description
Amount (£)
Debit Interest13.20
Arrangement Fees100.00
Total to be deducted on 25 Oct 2007:

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Now I admit, I am well in to my overdraft each month, and some months go over my £1100 limit, however this month, I think I went over by £105.

What I am asking is, can they charge me this amount? Is it a penalty? If so, surly it is too much. I think they are just being spiteful now that I recently got back £3500 in charges from them.

Thanks in advance.

dunstonh

arrangement fees are admin charges and not penalty charges

Mike12421

So can they still charge me £100? Seems a bit steep!

noh

Its £25 each time you go overdrawn or exceed your overdraft limit. So you have incurred 4 charges. Here's the price list http://www.hsbc.co.uk/1/PA_1_5_S5/content/uk/pdfs/en/bank_acct_cards_trav_q4.pdf;jsessionid=0000HWT8JSNW_3hIdarulD2mghm:12c58n73a

Nigel

Mike12421

Thanks.

On a side note, I was under the impression that charges could now only be a maximum of £12 for each instance, if this applied to my account then the charges would be £48 and not £100....Have I got this completely wrong?

noh

Don't know where you got that impression from. Are you getting confused with the ruling that a fair level for credit card penalty fees is a maximum of £12 ?

Nigel

Mike12421

I am getting confused, and mixing up the two, however it does seem a little tight of them to charge me that amount, and not allow me to increase my overdraft.

Labman_2

I'm not having a dig, but you got £3500 back recently & you still go over your overdraft limit?

jonesMUFCforever

Mike12421 wrote: »

I am getting confused, and mixing up the two, however it does seem a little tight of them to charge me that amount, and not allow me to increase my overdraft.

If they have said no to increasing your O/D then you are going to have to accept it or pay the price.
The only other alternative as I see it is that you apply to another bank to transfer your account and overdraft.

Dylanwing

You have to admire the Banks, same old charges, but with a new name, and as they are now admin. charges, absolutely fine... allegedly! One regular theme on these Forums is the astronomical APR of places like Payday Loans and, my favourite, The Money Shop. Yet, had you cashed cheques for £130 at the MS, it would have cost you £16.90 and you would have had £113.10 to pay in, and avoid the charges of £100. Or you could have paid in £105 and had a few pints! Use only in emergencies, always have a repayment plan and stick to it, and you can have a high APR loan as a Money Saving Tip.
Obviously it is cheaper still to budget properly.... Easier said than done some Months!