Why a bank charges win doesn’t mean the end of ‘free banking’ blog discussion

Former_MSE_Lawrence

Martin's written a blog on bank charges reclaiming you may be interested in... 'Why a bank charges win doesn’t mean the end of ‘free banking’

There's also an official discussion link at the bottom of it.

Paul_Herring

Martin wrote:

In days of yore, if you attempted to pay a Direct Debit or cheque with insufficient money in your account it simply wasn’t paid out. Then it changed, probably because some bright banking spark decided that more money could be made if they did pay out. Now, the real system is hidden, but it works like this:

How overdrafts really work:

Authorised overdraft limit: £1,000

Unaurthorised hidden ‘paid limit: £2,000

Unpaid beyond that

You have to admire the profiteering genius of this system. Instead of not paying, the banks created a system where they would pay out, but would charge £35 a pop for every transaction - no matter how small - beyond that limit. It’s no wonder they now make from £1.6bn to £3bn a year from this.

Erm - didn't they used to charge for bouncing cheques? Each time?

a11waysindebt

Nothing in life is free,This site isn't really free,Tesco club card points are not free.

Mark7799

Lots of discussion about reclaiming and one little line at the bottom saying "the best way to deal with them is still to avoid them". A bit more advice on that wouldn't be unappreciated by many.

Tootsie_Roll

Mark7799 wrote: »

Lots of discussion about reclaiming and one little line at the bottom saying "the best way to deal with them is still to avoid them". A bit more advice on that wouldn't be unappreciated by many.

And regardless of any 'education' people will still go over their limit and blame the bank for it. Just look at the thread where people are on their second or third claim - completely unbelievable !

rog2

Mark7799 wrote: »

Lots of discussion about reclaiming and one little line at the bottom saying "the best way to deal with them is still to avoid them". A bit more advice on that wouldn't be unappreciated by many.

If the 'charges' weren't there in the first place - we would not need to 'claim them back'. NOR would we need to "avoid them".
It is also difficult to "avoid them" when the first that we know is when we see our statements.
The real 'bottom line' is that they are 'punitive', 'unfair', 'unlawfull (and possibly illegal)' and a moneyspinner for the banks.

a11waysindebt

rog2 wrote: »

If the 'charges' weren't there in the first place - we would not need to 'claim them back'. NOR would we need to "avoid them".
It is also difficult to "avoid them" when the first that we know is when we see our statements.
The real 'bottom line' is that they are 'punitive', 'unfair', 'unlawfull (and possibly illegal)' and a moneyspinner for the banks.

Hi,But we all know what would happen if we went overdrawn,

I run a business myself and make charges and have running costs and I also make money,may be not alot but I make money.

With all this fiasco going on are we not turning in to a "I will sue you country" if you rip me off.

Smasher

Tootsie_Roll wrote: »

And regardless of any 'education' people will still go over their limit and blame the bank for it. Just look at the thread where people are on their second or third claim - completely unbelievable !

When you pay for stuff on credit & debit cards as most people do these days, it is impossible to know when money is going in & coming out of your account. This could be solved if banks were to put in place a more 'user friendly' system. Even if you deposit cash at your local branch, it takes 24 hours to clear. There is no good reason for that.
The system of chaotic money transfers & clearance times are deliberate and in place a) for banks to make profit by withholding funds and b) to catch you out as often as possible in order to charge you penalties.

Your remark has no validity whatsoever. Its like saying "look at those people who walk down dark alleys, they still blame thugs for getting mugged". :rolleyes:

chipbeck

Tootsie_Roll wrote: »

And regardless of any 'education' people will still go over their limit and blame the bank for it. Just look at the thread where people are on their second or third claim - completely unbelievable !

I'm crap with money always have been. Unfortunatel but true. I don't think the banks are very understanding and some of my charges have been horrific. It's my fault I just don't think the penalties are fair.

And finally is there any chance we can have a bank charges discussion thread where tootsie doesn't come on and tell us all what plonkers we are for going overdrawn etc. People get in this hassle sometimes not through their own fault (not me) so try and show some sympathy to people who's circumstances you know nothing about.

Mark7799

Smasher wrote: »

When you pay for stuff on credit & debit cards as most people do these days, it is impossible to know when money is going in & coming out of your account. This could be solved if banks were to put in place a more 'user friendly' system. Even if you deposit cash at your local branch, it takes 24 hours to clear. There is no good reason for that.

:rolleyes:

I WAS taught basic money management (am I unique ). Amongst the advice I was given:

• Assume money leaves your account the moment you make the transaction
• Don't assume payments are in your account until you've seen a printout of your account to confirm it
• Keep your own records (a pen and paper will suffice - nowadays I assume an Excel spreadsheet has replaced that)
• Check your own records to the Bank's records regularly - don't assume the Bank doesn't makes !!!!-ups and DON'T ASSUME THE BANK IS YOUR 'FRIEND'. 5 minutes a day can save hassle in the long run (I've been called sad for advocating this previously in posts but this system has meant I haven't been caught out going overdrawn for years.
• Get a small overdraft facility - it is not there for you to spend, it is there to protect against charges
• Don't leave it until the last minute to transfer money to meet direct debits, the interest you'd lose by transferring 2 or 3 days earlier is pennies (nowadays, possibly not even that)

I'm not having a go at anyone on this thread but trying to point out there are things that account holders can do to help themselves. In some (not all) cases it appears that account holders either don't know what they can do or don't want to do it.

Mark7799

rog2 wrote: »

If the 'charges' weren't there in the first place - we would not need to 'claim them back'. NOR would we need to "avoid them".
It is also difficult to "avoid them" when the first that we know is when we see our statements.
The real 'bottom line' is that they are 'punitive', 'unfair', 'unlawfull (and possibly illegal)' and a moneyspinner for the banks.

Charges are not unlawful. What is believed to be unlawful by many is the level of the charges. An outcome of this case is that charges are likely to be set at a lawful level. I'm addressing the issues of trying to avoid charges - this is a moneysaving site isn't it:rolleyes: ? If the charges are set at , say #3 per time, 3 charges per month will equate to #108 per year (sorry about the symbols -my keyboard's gone odd again:o ) plus any new charges for just operating the account which may come in. Pay them if you're happy to do so, I'm trying to suggest ways to avoid doing so.