Lloyds now moving charities to fee-paying Charity Accounts

magicmoneyportaloo

I would have a look at Unity Trust Bank.

mta999

K0nstant1n said:

For wmb194: I can't quote your last reply as I'm not not allowed to post your links yet! Regardless, we've yet to decide about the aggravation. However, at this stage, there's probably an emotive element as well. Specifically, why has Lloyds Banking Group with a net worth of £48bn decided to claw back 'a few quid' from registered charities while broadcasting word salad about how valuable we are to our communities? At best it's mean spirited and it's most certainly not ethical. 

I am curious - why do you think a charity (which is a business - although obviously not for profit) should not pay for banking services?

Eco_Miser

mta999 said:

K0nstant1n said:

For wmb194: I can't quote your last reply as I'm not not allowed to post your links yet! Regardless, we've yet to decide about the aggravation. However, at this stage, there's probably an emotive element as well. Specifically, why has Lloyds Banking Group with a net worth of £48bn decided to claw back 'a few quid' from registered charities while broadcasting word salad about how valuable we are to our communities? At best it's mean spirited and it's most certainly not ethical. 

I am curious - why do you think a charity (which is a business - although obviously not for profit) should not pay for banking services?

Why do you think the charity in question is a business? They don't seem to be selling anything, or charging rent.

K0nstant1n

mta999 said:

K0nstant1n said:

For wmb194: I can't quote your last reply as I'm not not allowed to post your links yet! Regardless, we've yet to decide about the aggravation. However, at this stage, there's probably an emotive element as well. Specifically, why has Lloyds Banking Group with a net worth of £48bn decided to claw back 'a few quid' from registered charities while broadcasting word salad about how valuable we are to our communities? At best it's mean spirited and it's most certainly not ethical. 

I am curious - why do you think a charity (which is a business - although obviously not for profit) should not pay for banking services?

By definition a charity exists solely for charitable purposes. A business exists for providing financial gain for its owners and/or shareholders. Fundraising activities will often include 'business-like' transactions (eg, selling cakes) but no individuals benefit from the proceeds - all profits go a charity's fund. Finally, we are only objecting to paying for routine day-to-day banking services, such as paying in cash obtained from a charity raffle. I hope this answers your question.

mta999

Thank you for your reply

Yes I understand the difference between a charity and a business but presumably you don't object to paying for other things to help you run your charity - for example an accountant to prepare your accounts, electricity, gas,  rental of a premises if applicable, transport etc etc so why would you object to paying for banking services? In what way are they different ?

HobgoblinBT

K0nstant1n said:

mta999 said:

K0nstant1n said:

For wmb194: I can't quote your last reply as I'm not not allowed to post your links yet! Regardless, we've yet to decide about the aggravation. However, at this stage, there's probably an emotive element as well. Specifically, why has Lloyds Banking Group with a net worth of £48bn decided to claw back 'a few quid' from registered charities while broadcasting word salad about how valuable we are to our communities? At best it's mean spirited and it's most certainly not ethical. 

I am curious - why do you think a charity (which is a business - although obviously not for profit) should not pay for banking services?

By definition a charity exists solely for charitable purposes. A business exists for providing financial gain for its owners and/or shareholders. Fundraising activities will often include 'business-like' transactions (eg, selling cakes) but no individuals benefit from the proceeds - all profits go a charity's fund. Finally, we are only objecting to paying for routine day-to-day banking services, such as paying in cash obtained from a charity raffle. I hope this answers your question.

If you take the “entitlement” of a charity to get goods and services for free why does a charity need money?  

Do staff who work rather than volunteer for a charity deserve to get paid? After  all they are working for a charity.  

Should the farmer who grows crops that are processed to food sold by food banks be paid for his goods?  After all it is for charity.

What about volunteer drivers? As their work is charitable why should they be reimbursed for their mileage expenses?

Then why should service providers including banks not be paid for their services, all be it at a reduced rate?

Charity bank accounts are not free of cost to the bank account provider.  Interpretation of AML rules by bank account providers vary but usually require substantially more due diligence and investigation in order to fully understand and document the aims of the organisation, its sources and use of funds, regular counterparties, any overseas links and due diligence on every associated trustee or significant linked person ie they cost a lot for the bank to host and maintain, Compare that to a fee paying trading business account that pays fees, you can get an idea of why banks and other providers have started to charge for accounts for the charity and community sectors.

In short, a charity should be able to negotiate a discount to the normal price of goods and services based on its charitable status but it is not an entitlement.

K0nstant1n

HobgoblinBT said:

K0nstant1n said:

mta999 said:

K0nstant1n said:

For wmb194: I can't quote your last reply as I'm not not allowed to post your links yet! Regardless, we've yet to decide about the aggravation. However, at this stage, there's probably an emotive element as well. Specifically, why has Lloyds Banking Group with a net worth of £48bn decided to claw back 'a few quid' from registered charities while broadcasting word salad about how valuable we are to our communities? At best it's mean spirited and it's most certainly not ethical. 

I am curious - why do you think a charity (which is a business - although obviously not for profit) should not pay for banking services?

By definition a charity exists solely for charitable purposes. A business exists for providing financial gain for its owners and/or shareholders. Fundraising activities will often include 'business-like' transactions (eg, selling cakes) but no individuals benefit from the proceeds - all profits go a charity's fund. Finally, we are only objecting to paying for routine day-to-day banking services, such as paying in cash obtained from a charity raffle. I hope this answers your question.

If you take the “entitlement” of a charity to get goods and services for free why does a charity need money?  

Do staff who work rather than volunteer for a charity deserve to get paid? After  all they are working for a charity.  

Should the farmer who grows crops that are processed to food sold by food banks be paid for his goods?  After all it is for charity.

What about volunteer drivers? As their work is charitable why should they be reimbursed for their mileage expenses?

Then why should service providers including banks not be paid for their services, all be it at a reduced rate?

Charity bank accounts are not free of cost to the bank account provider.  Interpretation of AML rules by bank account providers vary but usually require substantially more due diligence and investigation in order to fully understand and document the aims of the organisation, its sources and use of funds, regular counterparties, any overseas links and due diligence on every associated trustee or significant linked person ie they cost a lot for the bank to host and maintain, Compare that to a fee paying trading business account that pays fees, you can get an idea of why banks and other providers have started to charge for accounts for the charity and community sectors.

In short, a charity should be able to negotiate a discount to the normal price of goods and services based on its charitable status but it is not an entitlement.

Thank you for your thought-provoking reply. We realise that charities are not formally entitled to free services of any kind. However, Lloyds's decision to start charging us after banking with them for decades has still come as an unpleasant surprise. With hindsight we have taken their free routine banking for granted and should perhaps be grateful that we will not be charged the monthly fee that comes with the new Community Account. That said, we will still be looking at other banks, tempered with the knowledge that they could subsequently follow Lloyd's example.