Why dont we just all boycott the banks in the test case

Sol00

They may not be able to see how much debt you're in, but they do have some idea when carrying out a credit check and it's obvious their criteria for getting an increased OD or new credit card is more relaxed.

As well as that, I have recently started to get junk mail from Provident offering loans upto £800, funny that they're offering this when my credit rating is probably zilch.

The fact is, if people get junk mail offering them C/Cards with £500 credit limits, then some people will take advantage of it even just to chance and see if they will get it (I did it as soon as I turned 18 and it was the worst thing I could've done). The bank knew I had just turned 18 and knew I had no credit history so in my view they should take some responsibility for accepting somebody who could not afford the repayments.

Alikay

Sol00 wrote: »

As well as that, I have recently started to get junk mail from Provident offering loans upto £800, funny that they're offering this when my credit rating is probably zilch.

Every week I get 2 for 1 pizza deal offers through my door, and I'm about a stone overweight. What, really is the difference? Banks are like any other commercial organisation and they want your money to be spent on their products. I think maybe schools and parents have a duty to educate about the dangers of debt and overspending. Maybe even a government campaign as with the smoking, drinking and safe sex ones, but you can't realistically expect a bank to regulate who they flog their financial services to.

Maybe in the days when they were more cautious it was because people had less assets to seize (cars, own homes etc) should it all go belly-up. And debt was socially unacceptable so people would go to great lengths to pay debts for fear of friends or employers finding out. When we were first married DH was in the Army and a colleague defaulted on his HP - the company informed his Commanding Officer who dished out military punishment in addition to his default fee...bang went his promotion prospects! I wouldn't want to return to such infringements of my liberty, so I play by the rules, and if I mess-up I'll have to pay up!

Nathan_Spleen

Banks have a duty to lend responsibly. It is universally accepted that they don't.

http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article4160245.ece

Alikay

I agree that there should be a maximum permissible interest rate, linked to current base rates, but if an agreement is broken by unauthorised spending or missed payments I think it's reasonable to penalise the breaker of that agreement with a fee. Broken contracts in other walks of life incur various penalties, so I don't see that a bank imposing one is any different.

Incidently I don't work in finance at all - I just work damned hard to stay within my overdraft limit, plus I remember the days before free banking when each cheque or standing order from my account cost , I think, 15p. I feel that taking away a bank's right to apply hefty penalty charges threatens free banking for the compliant amongst us!

mrposhman

The banks do have a responsibility and must take that responsibility seriously, though the people have to take responsibility too. As a country we have moved towards the "blame someone else for my own shortcomings" society and we need to move back towards taking responsibility for your actions.

Going back to the original poster who clearly has no idea about legal or financial issues. Others have commented on the legal issues but I would like to go back to the Northern Rock example. Northern Rock began because someone "found out" that their business model led massively towards short term cash borrowings from other banks. When the banks started slowing the amount of cash in the market, they began to get into short term cash issues. The public essentially created the problem by jumping the gun and removing cash effectively making a smaller issue much larger. As for them going bust, I have never bought this from anyone and least of all the government. The shareholders rejected an offer that in fact would have provided a much better option than nationalisation and frankly deposits were never at risk no matter what alastair darling says as the government has always stated that Northern Rock had a healthy balance sheet. Yes cash is king and the business model was flawed massively but there is no way that Northern Rock would not have been bought out by others even if they had to sell off some of their mortgage or loan assets.

Sol00

Alikay wrote: »

Every week I get 2 for 1 pizza deal offers through my door, and I'm about a stone overweight. What, really is the difference? Banks are like any other commercial organisation and they want your money to be spent on their products. I think maybe schools and parents have a duty to educate about the dangers of debt and overspending. Maybe even a government campaign as with the smoking, drinking and safe sex ones, but you can't realistically expect a bank to regulate who they flog their financial services to.

Maybe in the days when they were more cautious it was because people had less assets to seize (cars, own homes etc) should it all go belly-up. And debt was socially unacceptable so people would go to great lengths to pay debts for fear of friends or employers finding out. When we were first married DH was in the Army and a colleague defaulted on his HP - the company informed his Commanding Officer who dished out military punishment in addition to his default fee...bang went his promotion prospects! I wouldn't want to return to such infringements of my liberty, so I play by the rules, and if I mess-up I'll have to pay up!

The difference with the pizza joint and the bank is that the pizza joint don't have the resources to check if someone is overweight or not, whereas a bank does have the resources to check if a potential customer is a risk or not. In my view that is a huge difference as you pay for the pizza or chips etc on the spot with what cash you have, however, with a bank you are tied to something you may not have thought about.

It's all very well to say people should think ahead and shouldn't jump the gun so to speak, but it's not always as simple as that for people who genuinely need the extra cash. In those circumstances the bank has a moral duty to make sure the person can afford to make the repayments and that is where I believe they have failed simply to make a buck, therefore I have no sympathy with any of them.

Nathan_Spleen

Alikay wrote: »

I feel that taking away a bank's right to apply hefty penalty charges threatens free banking for the compliant amongst us!

Banks do not have a ''right to apply hefty penalty charges''. Why do you think they're in court?

Presumably you cuss at having to pay your own electricity bill, do you?

Alikay

Nathan_Spleen wrote: »

Presumably you cuss at having to pay your own electricity bill, do you?

Not at all. As indicated in my posts, I am very much for everyone paying for what they themselves use.....electricity bills as well as unauthorised overdraft facilities

inmypocketnottheirs

Nathan_Spleen wrote: »

Banks do not have a ''right to apply hefty penalty charges''. Why do you think they're in court?

Hence my analogy to pickpockets.

If they were not in Court, it would not be if there acts were unlawful or illegal. There is no need to split hairs between civil and criminal law, my analogy was used in the same way as yours re electricity bills. Analogies are used to illustrate points, nothing more.

Nathan_Spleen

Alikay wrote: »

Not at all. As indicated in my posts, I am very much for everyone paying for what they themselves use.....

I'm with you. It must have been a different Alikay that was putting forward the argument that you should either pay or not pay for something based entirely on how ''compliant'' you are.