Don't let the Banks rip you off

Keeping your finances in good order is part of our conditions of employment. And I'm permanent staff and have been for 17 years.

Ulster Bank (same parent company) give you until 12.00 on the day it's due to pay funds in!

1) Extortionate Charges

It wasn't £25 it was £35, plus probably something similar from the payee who didn't get their money in time. It would appear from this mornings Money Mail that the OFT disagree with MarkymarkD. They suspect that these charges are disproportionate to the cost and are maybe used to subsidise court costs against big-time defaulters? A consequence of this is the banks may be quite pleased when Mr Average (including me!) temporarily flouts the T&C's as it's alleged they make good profit from the charges (so far I understand they're refusing to reveal how much). Hence, I suspect, NatWests beligerance.

2) Direct debit and having the funds in your account

Agreed, putting cash in on the day of the transaction is not a sensible way to behave; but it was the only way to behave in the circumstances (discovering at a weekend that an expected credit hasn't arrived) and was a genuine attempt to stay within the terms of the account. Having taken the time & trouble to withdraw cash from a Buiding Society account and phsically pay it in first thing Monday I didn't think it unreasonable to request the charge be credited (I would for a long-standing, valued customer). Eventually, after a lot of effort, I achieved this; but it has left a sour taste and a desire to find a new bank.

Cas's point worked for me. The Lending Office (which is where you end up by default) refused point blank to credit the charge; no wavering; you've 'ad it son! The Customer Care office (who's number they eventually offered after they gave up trying to sell me a loan) agreed immidiately to credit it as it had been "an honest mistake, but don't do it again".

I know the days of local branch Bank Managers (in the cupboard?) have disppeared but getting put through to a glorified loan shark when you want to discuss a grievance is taking it too far.

Haven't worked out the quote tool, so apologies for "cut 'n' paste" approach:-

MarkyMarkD said - "Banks are profit-making institutions - it's their JOB to make money for their shareholders."

Absolutely. And I wish a bit more of those profits went towards making up the shortfalls in my Pension and Endowment funds. Probably broaden the discussion beyond the scope of this Forum to get into the "Fat Cat"/Corporate Ethics/Government Interferance debate. As you can probably, tell I'm of the opinion that without occasional interferance by bodies such as the OFT our Financial Institutions and their Executives would be even more self-serving than they are presently.

MarkyMarkD said - "There are elements in a personal current account contract which are loss making - allowing free cheque payments, allowing free cash withdrawals, providing promotional 0% interest free periods when you open the account, or whatever.

These can ONLY be funded by making a profit on other elements of the contract - basically, overdrawn interest charges and charges for breaching the terms of the contract."

So there it is. Penalties for breaches of T&C's are NOT to dissuade you from doing so; they're not to recover the cost of such breaches; in fact they are an important revenue stream that the bank relies on to finance it's business.
The Marketting men say "We need to be appearing to offer free banking and interest on current a/c's" and the Financial guys say "OK we'll fund it by ripping off the punters who occasionaly get their timing wrong".

You could argue that it doesn't really matter if they make their profit through up-front transaction charges or if it's "hidden" in Penalties etc.. Personally I'd prefer openess and transparancy; and so, it would seem, does RBS Chief Exec. Sir Fred Goodwin. In the Introduction to last years RBS "Corporate Responsibility Report" he says:-

"...we run our business responsibly – with integrity and openness delivering optimum financial results within clearly defined business principles...."

In my opinion he still has a little way to go with regard to Penalty Charges.

MarkyMarkD said - "offering a loan to someone who is having difficulty remaining within their agreed overdraft limit is not an unreasonable step for a bank to take, is it?"

No, your right it isn't. And it's good business practice providing your OPEN about what your doing (it's that word again). But when you dial a phone number purporting to be your local branch to discuss a grievance and get put through to a centralised Lending Office (who do not introduce themselves as such) who are, I suspect, "incentivised" to sell you a loan rather than resolve your grievance...well, I think Sir Fred ought to take a look at that area of his business as well.

We will all have different ideas about what constitutes a "rip off" and if your well organised enough to exploit free banking to it's full advantage without falling in the penalty trap (and I guess the a lot of visitors to this site are!) you're unlikely to have too much sympathy with those that do. But for the majority of people their bank account is one of lifes necessities that they just want to run seamlessly in the background, trusting they're getting a fair deal and without having to read the small print every time a new version of the T&C's drops on the doormat. I suppose I can thank NatWest for waking me from that stupor!

The point your making about what banks used to charge before 'free' (there's the first joke) banking is a piece of nonsense because that was in the days when you were paid cash in hand and could avoid the banks and their rip off ways altogether. Now almost everyone who works in a legit job must have a bank account to lodge their salary into. It is a total monopoly. I suspect it's also no coincidence that broadly speaking all the high street banks have roughly the same rip off charges as each other. You couldn't put a fag paper between them and unfortunately the more people don't question them the longer they will get away with it