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  • FIRST POST
    • Former MSE Helen
    • By Former MSE Helen 17th Mar 14, 4:41 PM
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    Former MSE Helen
    MSE News: Banks pledge to provide data that may help you find your perfect account
    • #1
    • 17th Mar 14, 4:41 PM
    MSE News: Banks pledge to provide data that may help you find your perfect account 17th Mar 14 at 4:41 PM
    "Major banks have pledged to provide current account data in a standard format. The government hopes it will encourage new comparison sites that could help consumers check if they're getting the best deal."

    Read the full story:

    Banks pledge to provide data that may help you find your perfect account



    Click reply below to discuss. If you havenít already, join the forum to reply. If you arenít sure how it all works, read our New to Forum? Intro Guide.

    Last edited by MSE Archna; 17-03-2014 at 6:11 PM.
Page 1
  • innovate
    • #2
    • 17th Mar 14, 5:05 PM
    • #2
    • 17th Mar 14, 5:05 PM
    Following in the footsteps of the 7-day switching guarantee, this sounds like yet another attempt to convince people that they should only ever want one current account. If so, it would be disappointing to see MSE support the initiative but it would obviously be good if all the key features of each current account could be found in a single table on a website. Why do we need George Osborne for this?
    Last edited by innovate; 17-03-2014 at 5:09 PM.
    • Herbalus
    • By Herbalus 17th Mar 14, 9:41 PM
    • 2,363 Posts
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    Herbalus
    • #3
    • 17th Mar 14, 9:41 PM
    • #3
    • 17th Mar 14, 9:41 PM
    I don't understand. I could draw up a table of all the current accounts and list their fees, interest and benefits in columns. What exactly is the big government innovation here??
    • Archi Bald
    • By Archi Bald 17th Mar 14, 10:02 PM
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    Archi Bald
    • #4
    • 17th Mar 14, 10:02 PM
    • #4
    • 17th Mar 14, 10:02 PM
    It usefully serves to divert attention from really pressing problems, such as people having unfettered free access to their credit files, or making banks to clearly display the applicable interest rates against all accounts, incl the ones with 0% interest.
    • Eco Miser
    • By Eco Miser 18th Mar 14, 2:41 AM
    • 3,445 Posts
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    Eco Miser
    • #5
    • 18th Mar 14, 2:41 AM
    • #5
    • 18th Mar 14, 2:41 AM
    And what's this about sharing customer's data? I want my financial (and other) data kept private.
    Eco Miser
    Saving money for well over half a century
    • JimmyTheWig
    • By JimmyTheWig 18th Mar 14, 8:26 AM
    • 11,866 Posts
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    JimmyTheWig
    • #6
    • 18th Mar 14, 8:26 AM
    • #6
    • 18th Mar 14, 8:26 AM
    I don't understand. I could draw up a table of all the current accounts and list their fees, interest and benefits in columns. What exactly is the big government innovation here??
    Originally posted by Herbalus
    Yes, easy to list benefits and costs for each account.
    But how do you know how those benefits and costs affect you personally? E.g. how many days in a year do you go overdrawn and by how much? What is your daily balance to apply in-credit interest to? How many months through the year do you qualify for a benefit? Etc...
    • miller
    • By miller 18th Mar 14, 8:44 AM
    • 1,314 Posts
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    miller
    • #7
    • 18th Mar 14, 8:44 AM
    • #7
    • 18th Mar 14, 8:44 AM
    I received a "duplicate" (never received the original) closure statement for a Nationwide ISA the other day. That could have done with being in a normal format, let alone a standard format. Each entry was multiplied to about 4 lines with varying different abbreviations provided on 3 sheets of A4.
    • Archi Bald
    • By Archi Bald 18th Mar 14, 10:27 AM
    • 9,376 Posts
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    Archi Bald
    • #8
    • 18th Mar 14, 10:27 AM
    • #8
    • 18th Mar 14, 10:27 AM
    Yes, easy to list benefits and costs for each account.
    But how do you know how those benefits and costs affect you personally? E.g. how many days in a year do you go overdrawn and by how much? What is your daily balance to apply in-credit interest to? How many months through the year do you qualify for a benefit? Etc...
    Originally posted by JimmyTheWig
    errm, you use your brains to figure out what applies to you?
    • Archi Bald
    • By Archi Bald 18th Mar 14, 10:29 AM
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    Archi Bald
    • #9
    • 18th Mar 14, 10:29 AM
    • #9
    • 18th Mar 14, 10:29 AM
    I received a "duplicate" (never received the original) closure statement for a Nationwide ISA the other day. That could have done with being in a normal format, let alone a standard format. Each entry was multiplied to about 4 lines with varying different abbreviations provided on 3 sheets of A4.
    Originally posted by miller
    is this in the wrong thread?
    • JimmyTheWig
    • By JimmyTheWig 18th Mar 14, 11:27 AM
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    JimmyTheWig
    errm, you use your brains to figure out what applies to you?
    Originally posted by Archi Bald
    So you think it would be relatively easy to work out how much interest you would earn over the course of a year with, say, the Santander 123 account?
    • JKSandy
    • By JKSandy 18th Mar 14, 11:55 AM
    • 697 Posts
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    JKSandy
    George Osborne and co should be looking to teach children at School about personal financial management.
    • Archi Bald
    • By Archi Bald 18th Mar 14, 12:21 PM
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    Archi Bald
    So you think it would be relatively easy to work out how much interest you would earn over the course of a year with, say, the Santander 123 account?
    Originally posted by JimmyTheWig
    Yep, dead straight forward to do.
    • Herbalus
    • By Herbalus 18th Mar 14, 12:23 PM
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    Herbalus
    So you think it would be relatively easy to work out how much interest you would earn over the course of a year with, say, the Santander 123 account?
    Originally posted by JimmyTheWig
    Yes. In fact, Santander provide a handy calculator to allow you to do just that: here it is.

    If your query is about the actual account balance you had last year and how much interest you would have got with them, that's purely an academic exercise and doesn't help, because you dont know that this years finances will be the same. What happens when you water bill goes up, or you start dating again, or you suddenly need a new car?
    • Archi Bald
    • By Archi Bald 18th Mar 14, 12:54 PM
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    Archi Bald
    The Santander calc is indeed a nice gadget if people want to get an idea of how much they could perhaps make.

    But to compare the interest paid (or charged) by a given set of accounts, you don't really need to work out what the amounts are in £££ for each of the accounts. You just compare the AER / APR.

    I suppose some people would be looking for magic answers on how much they would have to pay in charges if they went overdrawn. Again, that's relatively easy to compare between accounts by just looking at the charges documents each provider publishes. It is virtually impossible to produce a definitive answer in terms of £££ because there are an almost infinite number of variables. So any calculator will only be able to give some rudimentary comparison - - - one that you can make by just looking at a table of charges.
    • JimmyTheWig
    • By JimmyTheWig 18th Mar 14, 1:05 PM
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    JimmyTheWig
    It is virtually impossible to produce a definitive answer in terms of £££ because there are an almost infinite number of variables.
    Originally posted by Archi Bald
    If you used your last year's bank account balances and transactions, etc, then this would be a pretty good indication of the year to come.

    If your query is about the actual account balance you had last year and how much interest you would have got with them, that's purely an academic exercise and doesn't help, because you dont know that this years finances will be the same. What happens when you water bill goes up, or you start dating again, or you suddenly need a new car?
    Originally posted by Herbalus
    I accept that my finances this year won't be exactly the same as my finances last year. Just like my energy consumption won't be exactly the same this year and last year. But if I am going to compare energy suppliers then I will use my last year's usage to get the most accurate figures for me. It might be a colder winter this year, or an elderly relative may come and stay and need the heating turned up. But at least as a starting point the last year's usage is a pretty good approximation.

    Likewise I am pretty sure that my bank balance in the next year will be more like my bank balance was in the last year than, say, Alan Sugar's bank balance was in the last year or, say, a family on benefits' bank balance was in the last year.
    I am probably going to go overdrawn about the same number of times and by about the same amount this coming year as I did last year.

    I accept that it would be impossible to build a calculator that answers "what bank account will be best for me in the coming year?" But a calculator that answers "what bank account, on the current rules, would have been best for me in the last year?" wuold still be a pretty useful tool.
    • JimmyTheWig
    • By JimmyTheWig 18th Mar 14, 1:12 PM
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    JimmyTheWig
    Santander provide a handy calculator to allow you to do just that: here it is.
    Originally posted by Herbalus
    Ok, lets take a simple example.
    £3000 salary comes in at the start of the month.
    £3000 bills go out half way through the month.
    £1500 remains in the account as a minimum.

    So half the time there is £1500 in the account and half the time there is £4500 in the account.
    Santander asks "Your balance: how much is usually in your account?". What should I put in? An average of £3000, I presume.
    They tell me I'll get £89 interest. (I don't know why it doesn't say £90.)

    But that's not the case. I'll actually only get £72.50 as half the time I'll only be getting 1% interest not the 3% that my average balance suggests.

    And this is, obviously, a simple example. It was easy for me to calculate the real interest figure. But for most people bills don't come out of the account all in one go. So how would you calculate it?
    • Archi Bald
    • By Archi Bald 18th Mar 14, 1:21 PM
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    Archi Bald
    It's easy.

    A bank account that pays 3% AER on balances >0 will pay you more interest than one with 0% AER and is therefore "better" for anyone with a balance > 0.

    A bank account that pays 5% AER will pay even more interest than either of the above, so is "better" still.
    • JimmyTheWig
    • By JimmyTheWig 18th Mar 14, 2:52 PM
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    JimmyTheWig
    It's easy.

    A bank account that pays 3% AER on balances >0 will pay you more interest than one with 0% AER and is therefore "better" for anyone with a balance > 0.

    A bank account that pays 5% AER will pay even more interest than either of the above, so is "better" still.
    Originally posted by Archi Bald
    Yes that should be the case. Though if the interest rates are tiered the AER will be dependent on significant assumptions.

    But more relevantly, what's better - an account that pays 3% AER on balances > 0 or an account that pays no interest but gives you £5 a month each month you don't go overdrawn?
    The answer to that will depend on how much money is in your account at the end of each day.
    And I still think a good approximation will usually be the balances from last year.

    It would be possible to work out manually with a year's worth of statements, but would be very time consuming and quite tricky.
    It may be easy enough to approximate based on some simple assumptions about your usage.
    But would be even easier if the data was provided in a way an online calculator could read and work out for you.
    • Herbalus
    • By Herbalus 18th Mar 14, 3:17 PM
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    Herbalus
    But more relevantly, what's better - an account that pays 3% AER on balances > 0 or an account that pays no interest but gives you £5 a month each month you don't go overdrawn?
    Originally posted by JimmyTheWig
    Simple maths will tell you that. For example with Santander 123, £3000 at 3% will give you £7.50 per month. £2900 will mean 2% so a monthly return of ~£4.83 per month, before tax, so £6 and ~£4 after basic rate tax. That's not a big difference, so I would suggest that if your average is about £3000, sometimes more and sometimes less, then that's more or less the same as Halifax. (You can never know what your balance will be, so there's little use in knowing the exact figures. Add direct debit cashback and the fee into your calculations, and most people should be able to work out which is better without a huge government investment.)

    But would be even easier if the data was provided in a way an online calculator could read and work out for you.
    Originally posted by JimmyTheWig
    Are you suggesting you're happy to give your detailed financial account usage to an online calculator? Happy to give your consent for a third party to access your data from your bank?
    • Archi Bald
    • By Archi Bald 18th Mar 14, 3:59 PM
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    Archi Bald
    most people should be able to work out which is better without a huge government investment.
    Originally posted by Herbalus
    That is precisely the point. It's not as if there aren't a lot lot of hugely more pressing issues on which tax payers' money should be used.

    If they want to do anything about helping people to pick a suitable current account, perhaps they could use the money to educate the teachers that are supposed to educate the kids on personal finances.
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