Santander free forever bank account changes

IanManc

TheBanker said:

gt94sss2 said:

solidpro said:

But in my complaint I state that Santander says the reason they feel they can impose fees is because the banking landscape has changed. I would argue the landscape has not changed in relation to this product because of the fact free business banking is still readily available, they /would/ care about what other banks offer or not ?

Point taken about treating customer's unfairly.

Playing devil's advocate (sorry!), if I wanted to I could argue that landscape has changed in the past 20 years with things like:

- increased regulations
- introduction of ring fencing for UK retail banks

Yes, some costs will have gone down as well but the economics and business strategies of other banks will be different.

It won't be for the FOS to confirm whether the product is still viable or not for Santander to offer in determinating the outcome

I'm surprised Santander haven't used this argument, and I imagine they will when the complaints are assessed by FOS or by a court. I believe the original advertising said something like: We guarantee that unless there are any changes to the law or banking regulations, or any new taxes relating to bank charges, you will benefit from free day-to-day business banking forever...

There have been many, many changes to banking regulation since this offer was made, and I think there's a strung argument that in aggregate these changes justify Santander's commercial decision to make changes to their proposition. 

Clearly Santander don't think it's a strong argument or they'd have used it.

And they must have thought of it,  bearing in mind the "extensive work to understand the legal and regulatory position" and "many safeguards" before the decision was made that you have claimed, with your vastly superior knowledge.

eskbanker

solidpro said:

Devil's Advocate responses on here really get me down.

I can't say I've seen the Facebook group mentioned previously, but imagine that to be more like an echo chamber, if that's what you're wanting to read?  Threads on a site like this will tend to be more rounded, with multiple points of view being expressed, which to me seems more valid and useful than repeated posts driven more by 'lynch mob' emotion than considered analysis of the legal or contractual situation....

neilsedaka

This is the Facebook group. It is excellent, especially the posts by Lance French.

https://www.facebook.com/groups/434991753218662

Click the Files menu at the top for lots of good evidence and advice for when it is time to contact the FOS.

Facebook groups are really good with no adverts. Completely different to the default Facebook fare. Well run by voluntary admins and excellent discussions. To ignore is to miss out!

janusdesign

neilsedaka said:

This is the Facebook group. It is excellent, especially the posts by Lance French.

including the one when he threatened a Santander employee that he'd call the police if Santander took any fees ? 

Just had my complaint call back. Nice lady, just doing her job. Basically scripted. I also informed her taking money without my consent will be theft and I will call the police when they do.

pathetic. just pathetic.

reading that last month got me more angry than Santander imposing fees on the account - I wasn't inclined to complain to Santander / FOS about this before reading some of the stuff he posted - I certainly wasn't going to afterwards. I long assumed FOS wouldn't rule before the charges were imposed, and i've got better things to do than fight for something that ultimately isn't really that important to me any more.

I now have new business accounts, opened and funded, with Mettle (took 5 days for approval) and Virgin Money (literally took 10 minutes to get approved) - have debit cards for both (haven't had one with Santander for years), monthly cashback on card purchases with Virgin, plus a business savings account with them too. Mettle don't support switching yet, so in 4 weeks time, i'll be switching the Santander account to Virgin - though I suspect Mettle will be my primary account.

for the record, I have no intention of closing any personal accounts with Santander - absolutely none.

I can now also unsubscribe from this thread because i've moved on from this topic - good luck to those who are fighting them for the right reasons, and doing it in the right way.

TheBanker

IanManc said:

TheBanker said:

gt94sss2 said:

solidpro said:

But in my complaint I state that Santander says the reason they feel they can impose fees is because the banking landscape has changed. I would argue the landscape has not changed in relation to this product because of the fact free business banking is still readily available, they /would/ care about what other banks offer or not ?

Point taken about treating customer's unfairly.

Playing devil's advocate (sorry!), if I wanted to I could argue that landscape has changed in the past 20 years with things like:

- increased regulations
- introduction of ring fencing for UK retail banks

Yes, some costs will have gone down as well but the economics and business strategies of other banks will be different.

It won't be for the FOS to confirm whether the product is still viable or not for Santander to offer in determinating the outcome

I'm surprised Santander haven't used this argument, and I imagine they will when the complaints are assessed by FOS or by a court. I believe the original advertising said something like: We guarantee that unless there are any changes to the law or banking regulations, or any new taxes relating to bank charges, you will benefit from free day-to-day business banking forever...

There have been many, many changes to banking regulation since this offer was made, and I think there's a strung argument that in aggregate these changes justify Santander's commercial decision to make changes to their proposition. 

Clearly Santander don't think it's a strong argument or they'd have used it.

And they must have thought of it,  bearing in mind the "extensive work to understand the legal and regulatory position" and "many safeguards" before the decision was made that you have claimed, with your vastly superior knowledge.

The argument they have used is 'the landscape has changed'. It would be easy to expand on this as part of a FOS submission or court defence to say 'the landscape has changed as a result of significant changes to regulation over the last 10+ years (as per the original caveat) and therefore it is no longer viable to offer free banking'. It may be an argument they're keeping in reserve for their first FOS or court case.

Section62

TheBanker said:

IanManc said:

TheBanker said:

gt94sss2 said:

solidpro said:

But in my complaint I state that Santander says the reason they feel they can impose fees is because the banking landscape has changed. I would argue the landscape has not changed in relation to this product because of the fact free business banking is still readily available, they /would/ care about what other banks offer or not ?

Point taken about treating customer's unfairly.

Playing devil's advocate (sorry!), if I wanted to I could argue that landscape has changed in the past 20 years with things like:

- increased regulations
- introduction of ring fencing for UK retail banks

Yes, some costs will have gone down as well but the economics and business strategies of other banks will be different.

It won't be for the FOS to confirm whether the product is still viable or not for Santander to offer in determinating the outcome

I'm surprised Santander haven't used this argument, and I imagine they will when the complaints are assessed by FOS or by a court. I believe the original advertising said something like: We guarantee that unless there are any changes to the law or banking regulations, or any new taxes relating to bank charges, you will benefit from free day-to-day business banking forever...

There have been many, many changes to banking regulation since this offer was made, and I think there's a strung argument that in aggregate these changes justify Santander's commercial decision to make changes to their proposition. 

Clearly Santander don't think it's a strong argument or they'd have used it.

And they must have thought of it,  bearing in mind the "extensive work to understand the legal and regulatory position" and "many safeguards" before the decision was made that you have claimed, with your vastly superior knowledge.

The argument they have used is 'the landscape has changed'. It would be easy to expand on this as part of a FOS submission or court defence to say 'the landscape has changed as a result of significant changes to regulation over the last 10+ years (as per the original caveat) and therefore it is no longer viable to offer free banking'. It may be an argument they're keeping in reserve for their first FOS or court case.

Except:

1) Other banks offer free business banking.

2) HSBC used to charge for business banking, but right now are making it free.

3) Santander (and other banks) - under the same regulatory framework - are capable of providing (orders of magnitude more) free personal current accounts, apparently without facing bankruptcy.

So if this really was what they have in reserve (and I'd be amazed if their legal advisers green-light it) then it stands next to 'the dog ate my homework' in the scale of blame-shifting excuses.

On the other hand, Santander have been expressing frustrations about over regulation in the UK. So in that context, 'the landscape has changed as a result of significant changes to regulation over the last 10+ years' could be seen as fitting into a pattern of comments aimed at having regulations cut back.  Perhaps we'll find out if Santander threaten to quit the UK market if FOS uphold these customer's complaints?

GeoffTF

Section62 said:

1) Other banks offer free business banking.

None of the other banks are offering "free for life" business accounts.

Section62

GeoffTF said:

Section62 said:

1) Other banks offer free business banking.

None of the other banks are offering "free for life" business accounts.

Actually I think the point you've edited out of your post (something like 'are they doing it profitably or is it a loss leader') was probably the stronger point.  For that you'd need to ask the banks, but the collective wisdom here seems to be that there is little to no profit to be made from providing current accounts - the profit comes from selling other services to current account customers (or maybe is about increasing market share to boost company value).

On the remaining point, it doesn't seem relevant to the issue under discussion.  Santander are also not offering "free for life" business accounts currently.  We're talking about promises made in the past.

This 'regulatory burden' argument being put forward by some forum members would apply irrespective of the "for life" component.  If it costs too much to provide free business accounts now, then how can the other banks do it?  If it might cost too much in the future, then come back and make the case for introducing charges when that time comes.  None of us know what will happen in the future - if the government roll back regulation (e.g. ringfencing) then the future costs of providing free banking could reduce.  Justifying the imposition of charges today - in case regulatory costs increase in the future - isn't a persuasive argument.  So in the here and now, the "for life" bit doesn't matter.

GeoffTF

Section62 said:

GeoffTF said:

Section62 said:

1) Other banks offer free business banking.

None of the other banks are offering "free for life" business accounts.

Actually I think the point you've edited out of your post (something like 'are they doing it profitably or is it a loss leader') was probably the stronger point.  For that you'd need to ask the banks, but the collective wisdom here seems to be that there is little to no profit to be made from providing current accounts - the profit comes from selling other services to current account customers (or maybe is about increasing market share to boost company value).

On the remaining point, it doesn't seem relevant to the issue under discussion.  Santander are also not offering "free for life" business accounts currently.  We're talking about promises made in the past.

This 'regulatory burden' argument being put forward by some forum members would apply irrespective of the "for life" component.  If it costs too much to provide free business accounts now, then how can the other banks do it?  If it might cost too much in the future, then come back and make the case for introducing charges when that time comes.  None of us know what will happen in the future - if the government roll back regulation (e.g. ringfencing) then the future costs of providing free banking could reduce.  Justifying the imposition of charges today - in case regulatory costs increase in the future - isn't a persuasive argument.  So in the here and now, the "for life" bit doesn't matter.

I decided that the main point was the one that I left. The point is at issue is not whether it is still viable for Santander to offer free business accounts. It is whether it is still viable for them to offer free for life business accounts. Santander has decided that it is not. Offering a free business account as a loss leader to collect customers and introduce a fee a few years later is still viable. It does not cost too much until they have collected the new customers, and they retain a high proportion of them after they introduce the fee. Offering a free for life business account is a different matter altogether.

solidpro

TheBanker said:

This is a key question - assuming the FOS route is sucessful, what outcome are people looking for. I know the immediate answer will be to reinstate free banking forever, but if FOS decide they can't direct Santander to do that, their only option is to aware compensation. So how much compensation are people going to be seeking, and for what? Bearing in mind that the customers can avoid any costs by switching to another bank, and that there is a switching service to make this as easy as possible?

For a start, 3 days at my daily rate for the hassle of moving to another bank and for second seeing as they can't complete their contract (giving me free business banking forever), I'd like all the interest (of which I recieved zero) at base rate I would have had on my balances since opening the account in 2008.