MSE News: Call for banks to help financially excluded
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I disagree with Lokolo here. Simply give the Post Office full banking rights, with a small subsidy from the government. To attract/steal customers from the private sector:
* find a way of minimising bank charges.
* scrap those stupid worthless Visa Electron/Solo cards
* give all customers a normal debit card. when funds are insufficient in their account, the debit card will NOT work. Computer software is intelligent enough to know when somebody's a/c is empty: high street banks are well aware of this.
* if the customer applies for a cheque book and writes out a cheque knowing there are insufficient funds in a/c they'll encounter banking charges.
* treat customers with a bit of respect unlike high st. banks.
I'd rather deal with a payday loan company, as opposed to grovelling to some low life bank manager for an overdraft.
Your point has nothing to with all customers being allowed affordable credit, which is what the article is to do with.....0 -
The way I read that article it seems like they are wanting banks to not exclude customers from certain facilities just because they are low down the credit ladder and can only get a basic banking account
Yeh the artcile was a bit of a mix of things. It seemed to indicate they want both accounts AND affordable credit. I couldn't work out if the artcile was aimed at both separately, or both together.0 -
"As a result, it said these people were being forced to borrow money from payday lenders and home credit companies, which often charged interest equivalent to 2,500% a year"
That's not a kick the behind off what the new 'simpler' Halifax charges work out at for small overdrawn balances.
People should have access to a basic account, there is no right to borrow money.
Whilst some people will certainly lose out because they don't have a bank account and thus can't have DD's equally they cannot incur bank charges. Personally I think direct payment wasa pretty boneheaded manoeuvre by the government since it exposed a section of the population, who previously couldn't fall foul of bank charges, to the risk of incuring them.
Mixed Martial Arts is the greatest sport known to mankind and anyone who says it is 'a bar room brawl' has never trained in it and has no idea what they are talking about.0 -
The way I read that article it seems like they are wanting banks to not exclude customers from certain facilities just because they are low down the credit ladder and can only get a basic banking account
Personally I'd like to see banks doing away with so called basic bank accounts and offering full accounts to all. Before anyone jumps down my throat I don't mean offering things such as overdrafts, full debit cards and credit cards to all. I mean only having a standard current account and then tailoring its facilities to meet credit worthiness.
Take natwest (who I bank with) the only differences between the basic step account I have and the full current plus account are- Offline Visa Debit + Cheque Guarantee (subject to status anyway, online visa debit same as step account offered to everyone else)
- Cheque Book (extinct and I think subject to status)
- Overdraft (subject to status)
Having said that I totally agree with the views of lokolo and other earlier posters that banks should not just throw credit at people. That's not what I'm saying though. I just think it should be easier for people who have made mistakes in the past to get back on the ladder and get more and better facilities if and when they are ready and offering full, but individually tailored, accounts to all would be one way of doing this
What is the difference between your suggestions and the definition of a basic bank account?
Also, the fact that banks overlook basic account customers for upgrade is wrong. Basic accounts cost the bank money, hence the reluctance to give them. So if anything, these are top of the list for banks to upgrade once a good behaviour trend is seen.
I'm testament to this. HSBC basic account to First Direct in less than a year.Debts at LBM (May '08) £5760 - Lloyds CC £4260, Lloyds OD £1500;Debts as of May 28th 2011:Santander CC: £0.00Lloyds OD : £0.00DFW Nerd #1247 - Proudly dealt with my Debts
Olympic 2012 Challenge #12
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What is the difference between your suggestions and the definition of a basic bank account?
Also, the fact that banks overlook basic account customers for upgrade is wrong. Basic accounts cost the bank money, hence the reluctance to give them. So if anything, these are top of the list for banks to upgrade once a good behaviour trend is seen.
I'm testament to this. HSBC basic account to First Direct in less than a year.
The difference is a basic bank account can't have a full debit card or an overdraft added to it regardless of how well that account is run. An individually tailored full account can!
And yes banks do overlook basic customers. Some banks when a full customer logs into Internet banking get offered pre approved overdrafts or loans. Basic customers don't get this
count yourself lucky hsbc upgraded you. Their basic account is about as basic as they come. Would hate to be stuck with just a cash card in this day and age0 -
The difference is a basic bank account can't have a full debit card or an overdraft added to it regardless of how well that account is run. An individually tailored full account can!
And yes banks do overlook basic customers. Some banks when a full customer logs into Internet banking get offered pre approved overdrafts or loans. Basic customers don't get this
count yourself lucky hsbc upgraded you. Their basic account is about as basic as they come. Would hate to be stuck with just a cash card in this day and age
But once the account has been managed well you can upgrade?
Lloyds also give a full debit card with their basic account.0 -
Personally I'd like to see banks doing away with so called basic bank accounts and offering full accounts to all. Before anyone jumps down my throat I don't mean offering things such as overdrafts, full debit cards and credit cards to all. I mean only having a standard current account and then tailoring its facilities to meet credit worthiness.
Take natwest (who I bank with) the only differences between the basic step account I have and the full current plus account are- Offline Visa Debit + Cheque Guarantee (subject to status anyway, online visa debit same as step account offered to everyone else)
- Cheque Book (extinct and I think subject to status)
- Overdraft (subject to status)
But this is exactly what they do at the moment. They offer all these facilities subject to status, it's just that most banks will give their basic account a different name and a different coloured card to their main account.
Is it that you are embarrassed to have a basic account, and would like people to think that you've got a full one? As your suggestions don't seem to change the actual facilities available to anyone.but importantly not excluding customers from being able to get more facilities in the future just because they only hold a basic account. There is a certain stigma attached with the basic bank accounts where the banks just overlook customers with these accounts for any form of upgraded product or credit
Nonsense.* give all customers a normal debit card. when funds are insufficient in their account, the debit card will NOT work. Computer software is intelligent enough to know when somebody's a/c is empty: high street banks are well aware of this.
Unfortunately computer software is not currently at the stage when this can always be relied upon. A small number of retailers do not have a direct link to banks to be able to authorise withdrawals instantly (e.g. on trains). This means that the transaction is authorised when there may not be money in the account - and the bank doesn't learn about the transaction until after the event.
However, I expect that with improvements in mobile/satellite technology, this will become possible in the near future - we're just not there technologically yet.* treat customers with a bit of respect unlike high st. banks.
My bank (a high street bank) treats me with respect, because I treat them with respect.
I follow the T&Cs laid out in our agreement, and so I am treated well.Lloyds also give a full debit card with their basic account.
No, although it is a Visa debit card, it is restricted, and does not have the same acceptance levels as a 'full' debit card.
It is more akin to a Visa Electron card.0 -
But this is exactly what they do at the moment. They offer all these facilities subject to status, it's just that most banks will give their basic account a different name and a different coloured card to their main account.
So according to you someone could subject to status get an overdraft added to a basic bank account. I'll just call natwest and ask them if that's the case shall I?Nonsense.
that's what natwest has just said 0 -
So according to you someone could subject to status get an overdraft added to a basic bank account. I'll just call natwest and ask them if that's the case shall I?
Not on the same account, but, subject to status, they will give you an account with an overdraft facility on it.
It just has a different name to the one that you have at the moment.
It's the same as if I have money in an instant access savings account, but I want a fixed rate account. The bank offers fixed rate accounts, so they are not being deceptive, or restricting my choice in any way. But I would need to change to an account with a different name.0
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