A&L Current Account overdraft policy

Jim02

GlennTheBaker wrote:

At the end of the day, its up to the customer to manage the account and stay within any agreed overdraft facility.

Couldn't agree more. And when occasional accidents happen, the penalty should be fair and in keeping with costs incurred.

origrudeboy

Quite shocked at level of support for banking policy here. I was expecting a little more support from fellow money savers here.

Agreed, you should never exceed O/D limit from an ATM and that is your own fault.

What no-one is mentioning is you can be equally punished for someone taking weeks to cash a cheque, companies taking several days, up to two weeks sometime to process debit card payments.

On top of that low payments, under a fiver or so are always permitted and can still trigger the bank charges. First Direct tried to charge me £25 for going 16p over my overdraft limit because my solicitor took two months to cash my cheque and I then bought a Boots sandwich.

What is so wrong with agreeing a limit with your bank and them stopping you from exceeding it. The cruel irony is just when you can't afford the charge is when they hit you with them.

If they say small payments are too negligble to check your credit limit each time, then how come they can justify a 10X times for this "negligble" amount.

I hope Martin picks this up, I think a full ban on exceeding O/D limits and therefore no charges would be a huge victory for consumers.

Of course, these charges are a lovely little earner for banks but I think the justification is completely lacking. If they can stop you taking money out when they want, why do they always allow one payment through to get the charge registered. Why not refuse that first payment. I would join any bank that was prepared to do this for me.

Derek

grumbler

origrudeboy wrote:

What is so wrong with agreeing a limit with your bank and them stopping you from exceeding it. The cruel irony is just when you can't afford the charge is when they hit you with them.

The wrong is that if you have a cheque quarantee card you can guaranee cheque(s) and this cheque(s) cannot be bounced. If you want bank to stop you from going into overdraft - open a basic account with visa-electron card without chequebook.

Jim02

origrudeboy wrote:

Quite shocked at level of support for banking policy here. I was expecting a little more support from fellow money savers here.

I'm surprised too. I think the problem is that some people on this board can't (or won't) make the distinction between wilful and flagrant abuse of the banking service, and those rare situations where an otherwise responsibly-run bank account has a hiccough, often outside the control of the account owner, which sends the account a few pounds into the red, thereby incurring overblown and punitive charges.

The second of these two examples is clearly unfair. Various consumer associations agree that it is and, arguably, so does the law. The more pious people that prowl this board, however, disagree. Everyone is entitled to their opinion.

davidcampbell

I'm surprised too. I think the problem is that some people on this board can't (or won't) make the distinction between wilful and flagrant abuse of the banking service, and those rare situations where an otherwise responsibly-run bank account has a hiccough, often outside the control of the account owner, which sends the account a few pounds into the red, thereby incurring overblown and punitive charges.

if an account is run normally well and is a ONE OFF error then most banks will see their way to reversing/refunding the charge incurred.

this is almost always the case unless the customer has been reckless.



whats pious about believing you shouldnt spending money that isnt yours without permission?


DC

MarkyMarkD

origrudeboy wrote:

What no-one is mentioning is you can be equally punished for someone taking weeks to cash a cheque, companies taking several days, up to two weeks sometime to process debit card payments.

You aren't punished for payments taking a long time to debit. You are charged for failing to make proper provision for these long-outstanding payments, and consequently exceeding your overdraft limit (if indeed you have such a limit).

If you manage your money properly, it's GOOD not BAD for payments to take a long time to clear. It's not rocket science to write the cheque details on your cheque stub, and to tick off each one as it clears. Similarly for debit card payments - keep the receipt and tick it off when that clears as well.

Jim02

davidcampbell wrote:

if an account is run normally well and is a ONE OFF error then most banks will see their way to reversing/refunding the charge incurred.

this is almost always the case unless the customer has been reckless.

I'm afraid I disagree. Throughout the life of a bank account, the unexpected will often occur. Many people can't check their balance every day, that doesn't mean they're being reckless or irresponsible.

whats pious about believing you shouldnt spending money that isnt yours without permission?

Absolutely nothing; I didn't say it was. You won't find a comment by me anywhere that condones going overdrawn. My issue is purely with the size of the penalty levied by the banks. This doesn't reflect the costs incurred or the risk involved, and doesn't benefit anybody except the banks (which, after all, are in business to make money, and this scam is a beaut).

My 'piety' comment was aimed at those who (I assume) have been lucky enough or rich enough to have never fallen foul of this practice, and their sanctimonious 'if you can't control yourself you deserve to be punished' attitude. It's very narrow-minded and makes no allowance for the fact that accidents happen and are often unavoidable, practically speaking.

grumbler

Jim02 wrote:

...lucky enough or rich enough ....

This is not a matter of luck or richness but a matter of self-discipline...

'if you can't control yourself you deserve to be punished'

No. If you cannot control yourself you do not deserve to have a full-scale account... If you cannot drive - walk, use taxi or public transport... If you cannot swim - don't do this... ....

Jim02

grumbler wrote:

This is not a matter of luck or richness but a matter of self-discipline...

No, not always.

No. If you cannot control yourself you do not deserve to have a full-scale account... If you cannot drive - walk, use taxi or public transport... If you cannot swim - don't do this... ....

Well, that's an interesting philosophy, in fact it sort of reinforces my point. If I can't 'control myself' (my words I admit, but a bad choice of words and not what I meant... but we'll use them for now!), then the responsible thing for the bank to do to save me from myself and minimise their risk, would be to charge me once then close my account. Nobody is forcing them to keep my account open.

If I'm such a risk and I cost them so much money with my 'lack of control', why are they happy to keep my account open? Why don't they close me down and blacklist me, refuse my business ever again?

Elementary my dear Grumbler -- they make a fortune out of punitive charges. They're happy to keep my account open because they're hoping I'll slip up again... and again... and again.

(p.s. I'm using myself in the above scenario for example purposes only!)

Grumbler, DC et al: It's not all black and white. If someone goes over their limit, it's not necessarily because they're irresponsible, or lazy, or reckless. And if the account is run responsibly, the risk to the bank when someone occasionally goes over their limit is negligible. To hit these customers with punitive penalties is morally (and legally) wrong, regardless of the Ts and Cs.

grumbler

Jim02 wrote:

If I'm such a risk and I cost them so much money with my 'lack of control', why are they happy to keep my account open? Why don't they close me down and blacklist me, refuse my business ever again?

Elementary my dear Grumbler -- they make a fortune out of punitive charges. They're happy to keep my account open because they're hoping I'll slip up again... and again... and again.

1. 'You' always have a choice to downgrade account yourself.
2. There are a lot of quite opposite examples arownd - when bank downgraded account and customer is far from being happy with this. Most recent is:

Debit card upgrade

And there are even more examples when people are eager to have full-scale account, but cannot get it because banks offer only basic accounts to them. Why banks do this instead of 'making a fortune'?

P.S. And I think most of us prefer to pay charges than to have accoount downgraded by a bank to a basic one. This is why nobody wants to downgrade voluntarily.