How long does a bank remember bad debt?

[Deleted User]

JuicyJesus wrote: »

To reiterate the point: you have no such right. They're a private business who can refuse any customers they please for any reason not contrary to law.

They are especially perfectly within their rights to refuse to have someone as a customer who has a history of bad debt with them, and I'm not sure why you'd think you should have a second chance.

Even the majority of murderers get a second chance. People do change as time goes by. Are you really saying that someone who defaults on a debt when they are 18 should have that fact remembered by an organisation for, say, 60 years, such that when they apply for a bank account in their seventies they are turned down? Permanent retention of this data is a disproportionate action and should be banned by the ICO. The regulator restricts data retention periods for the credit reference agencies and insurance companies (although a more rigorous approach does need to be taken for some data sets), so why should banks get away with it?


OP - you should contact your MP about this, and see where he stands on the matter.

[Deleted User]

johnsmith1890 wrote: »

Even the majority of murderers get a second chance.

Yes, but not generally with the family of the person they murdered.

Just with wider society.

[Deleted User]

Deleted_User wrote: »

Yes, but not generally with the family of the person they murdered.

Just with wider society.

What, you mean they are banned from murdering someone else from the same family?

[Deleted User]

Nope. I mean that the family is unlikely to invite them back round for tea any time soon.

[Deleted User]

IanManc wrote: »

That is an asinine attempt at a comparison.

Murderers receive a whole life sentence. If they are released they are on a life licence, with monitoring by the Probation Service and the police, and if they commit any further offences or fail to comply with the terms of their life licence they are returned to prison to serve their life sentence.

Life licences all include the following standard terms:

To be placed under the supervision of a nominated supervisor;
Report to the nominated supervisor as directed;
Receive visits at home from the supervisor;
Reside only at premises agreed by the supervisor;
Undertake work only where approved by the supervising officer;
Notify the supervisor of any change to, or loss of employment;
Obtain permission before leaving the United Kingdom;
Be well behaved and do not do anything to undermine the purposes of supervision on licence which are to protect the public and to secure successful reintegration into the community.

There will also be specific terms added by the Parole Board as required by the circumstances appropriate to the offender.

This bears no relation to a private company - a bank - choosing not to do business with someone who has previously had a history of bad debt; a choice which it is lawfully entitled to make.

Your attempt at a comparison with murderers is a complete fail.

Blimey! You don't appear to understand how to interpret an analogy. Your remarks are some of the most asinine I've come across in a long while. Okay, swap out murderer for speeding motorist, if that might help.

[Deleted User]

Or better yet, we could stop comparing the financial/banking industry with topics (un)related altogether.

Banks can hold the data for as long as they wish, and are not obliged to remove any blackmarks or "blacklists" on request.

[Deleted User]

johnsmith1890 wrote: »

OP - you should contact your MP about this, and see where he stands on the matter.

And that conversation will go:

"What's the matter?"

"I owed NatWest a load of money a while back and now they won't take me back as a customer"

"Oh right. Why do you expect them to do that?"

"Because it's my constitutional right and I said so"

"Erm..."

[Deleted User]

!!! wrote: »

Or better yet, we could stop comparing the financial/banking industry with topics (un)related altogether.

Banks can hold the data for as long as they wish, and are not obliged to remove any blackmarks or "blacklists" on request.

Yes, but the point of this thread is to suggest that they shouldn't be allowed to do this. I, for one, agree with this suggestion. I'm not saying they shouldn't hold such records for a significant period - I don't know, maybe 10 years or something - but to be allowed to hold them indefinitely is a disproportionate facility that they, the banks, currently have.

[Deleted User]

johnsmith1890 wrote: »

Yes, but the point of this thread is to suggest that they shouldn't be allowed to do this. I, for one, agree with this suggestion. I'm not saying they shouldn't hold such records for a significant period - I don't know, maybe 10 years or something - but to be allowed to hold them indefinitely is a disproportionate facility that they, the banks, currently have.

And quite rightly so.

Would you want to do business with someone that didn't pay you or screwed you over for a period of time?

[Deleted User]

IanManc wrote: »

For an analogy to be interpreted it needs to be an analogy in the first place.

Your attempt was an utter fail.

I think the speeding motorist one is actually quite a good analogy:


Speeding: you do something wrong, a record of this wrongdoing is kept, the record is deleted after a period of time.


Defaulting debt: you do something wrong, a record of this wrongdoing is kept, the record is never deleted.


Perhaps let's broaden it out a bit. If the debt is never repaid I wouldn't object to the banks having an indefinite record of this. Indeed, maybe accounting practices demand it. However, if a debt is repaid, then indefinite retention of the details is, in my view, disproportionate.


If an applicant is told that he can't get a loan due to an unpaid debt then, to me, a reasonable response would be "sorry, you owe us £xxxx and you defaulted, so we can't lend you any more money. If you pay off this debt we will consider your position again, but we will retain this record for (say) 10 years."


In the above scenario, 10 years after the debt had been satisfied, the applicant would be on a level playing field with the rest of us. I think this is reasonable.