The Banks Win

[chevin]

+1

I've been with the same bank for 22 yrs and never paid a single penny of penalty or interest charges to them. If you don't have the money in your account then you should not be spending it without their authority. If you do it is theft and you should therefore expect heavy penalty charges.

I am certain that for all of those last 22 years the penalty charge rates have been clearly printed on the back of all my statements so I would clearly know the consequences of going into the red.

Had the banks lost today then I am certain that once again, I would, as someone who is sensible and prudent with my money, soon be bailing out those who aren't.

and for people on the breadline? any sympathy?

[Bloo Loo]

Quite. It does the first time you mess up. Maybe even the second time. But once you've made a habit of it why shouldn't the bank just close your account?

indeed. they can choose to stop charging you.

or, as is the case of banks....dont they NEED to lend to make money?. get the client on a formal OD, one thats good for the bank and the client. just throwing charges are clients can just make matter worse....as the MSE and OFT were trying to enforce.

[SMAC67]

Injin, you are one of the few sane voices on this matter. Most posters haven't a clue about banks, the government, or the law.

Money doesn't exist, being charged for it's use is usary, it was banned by all major religions. Those pious enough to claim that they have never been overdrawn are about to discover the reality of the situation when the recession/depression kicks into second gear next year.

It's not like your neighbour borrowing your lawnmower and not returning it, the lawnmower exists and you have been denied it's use. The banks don't have any money, and even if they did, it's simply a figment of their overworked imaginations.

Complete monetary reform is the only solution to the complete destruction of western civilisation.

Of course it won't happen because the banks run the government who control the law courts. You are bottom of the pile, an irrelevant economic slave. Work hard and then die please, without a pension.

Enjoy 2010.

[Guest eight]

If £109 makes you overdrawn then I respectfully suggest you are sailing too close to the wind, and Id build up a bit of a buffer whoever you bank with.

That's a bit unkind. £109 is a lot of money to some, maybe even more than a week's wages. In credit is in credit, I can't see why you should have to leave "dead" money to legislate for other's potential ****-ups. Besides, banks don't like it if you leave a permanent balance in your current account, I guess now we know why.

eight

[Guest absolutezero]

And you say "no thanks" and they pay in legal tender.

Lemme see - someone who has a high sense of self esteem and is worth loads to their employer. Hmm Jay Z, the huge american rap star,

He said "I want to be paid in in euros. In a suitcase." his employer said "when do you want it?"

Alright, the toilet cleaner wouldn't have been able to do the same thing as easily - but that just prioves my point.

You say no thanks and they tell you "when you open an account we will pay".

Again, nice try.

[SarahBell]

and for people on the breadline? any sympathy?

If you want people to live beyond their means repeatedly then you bail them out.

[chevin]

People just need to get a grip

ever considered taking up counselling?

What a dumb ass comment. Absolutely no use what so ever. Things just aren't as simply as you would like!

[Injin]

You say no thanks and they tell you "when you open an account we will pay".

Then you go to court for what they owe you, win and get paid in legal tender.

Again, nice try.

Of course, you get on so well with your boss that you would only have to express your concerns and he would do whatever is necceassary to make things ok for you.

[Stars]

Then I really have to ask - how come they've had a case worthy of the supreme courts time and attention?

Money is an emotional subject - banks deal with money

The general principle is that you can't charge more for a service than it costs you if the choice is yours whether to perfom it or not. The banks can either loan the money (leaving aside the reality of how they actually operate) or not. Either is contracted for. If they choose to loan, they can't really claim anything more than costs because they freely chose to peform the action.

Again - the contract says you can have this much (under these conditions) for x or this much (under these conditions) for y.

It is the buyer's choice whether to go for the former or the latter

I'm sure you can see the general principle, no?

No - i can see someone fudging a very simple concept

[Sledgehead]

I think a quiet word in branch would sort this one out.

This worked with my credit card provider up to 3 times, possibly more in the time I've been with them. After the fourth time they suggested I set up a direct debt with my bank. Which I did. Never missed a payment since, funnily enough.

May I suggest others arrange their bank finances similarly by trimming out-goings, delaying / cancelling major purchases etc. Another piece of useful advice: just because the next door neighbour has just taken delivery of new double glazing / car / conservatory / fitted kitchen / tits, doesn't mean to say you must do so pdq.

[Johnny Storm]

That's a bit unkind. £109 is a lot of money to some, maybe even more than a week's wages. In credit is in credit, I can't see why you should have to leave "dead" money to legislate for other's potential ****-ups. Besides, banks don't like it if you leave a permanent balance in your current account, I guess now we know why.

eight

£109 is a lot for people who pay £70 a month smoking, and £50 a month on a mobile phone contract, and blow £50 on night out,, I tend to find.

How is money in the bank dead in any way? Something happens you draw it out, surely the money frittered away is the dead money?

Banks not wanting a permanent balance? What are you talking about? Totally made up. They love money in current accounts as they pay no interest on it!

[Injin]

Money is an emotional subject - banks deal with money

So is being mugged.

Again - the contract says you can have this much (under these conditions) for x or this much (under these conditions) for y.

It is the buyer's choice whether to go for the former or the latter

No, because that payment is not automatic. The bank can choose to loan you x or not. If they do choose to loan you x then they can only charge you the cost.

Why?

Because they didn't have to incur it - that was their choice.

No - i can see someone fudging a very simple concept

Same, tbh.

Lets say I have a contract with you - I can either loan you £10 or I can not bother. Either is fine.

If I do loan you £10 it will cost me £1

If I don't loan you £10 it will cost me £0.50

I can reclaim both of these costs from you if they are incurred. Fair enough.

Now lets add another element.

If I do loan you £10 I will incur a cost of £1 and can charge you £35

If I don't loan you £10 I will incur a cost of £0.50 but there will be no extra charge.

---------------------

if you can't see why the law generally frowns on the second set of circumstances between private individuals, I really don't know what else to say.

Edited November 25, 2009 by Injin

[Guest absolutezero]

Then you go to court for what they owe you, win and get paid in legal tender.

Of course, you get on so well with your boss that you would only have to express your concerns and he would do whatever is necceassary to make things ok for you.

Yes Injin.

Go to court, win and they give you a cheque!

[porca misèria]

+ 1

I think all these examples are being ignored because they don't fit their argument! Those who think just because THEY haven't had a charge in 25 years then everyone else shouldn't are living in la la land and don't see beyond the end of their noses.

FWIW, I have never been charged in all my adult life but I still think the charges are disproportionate and in some cases simply unfair (another means of making profit). I haven't experienced any of these fees / charges because I am LUCKY enough not to be living hand to mouth, have a reasonable income and can manage my accounts with a little leeway each month. Some are not so lucky.

I think you're missing the point.

I have been in the position of going overdrawn and incurring charges. I didn't like it, but neither did I go whining to some pressure-group collective mummy with the sympathetic ear of most of the meeja.

Since my earnings at the time were, in round numbers, nil, I did take it as a cue to "sign on". About 3 or 4 weeks later I was getting £54/week plus housing benefit of about 90 quid a month short of actual rent. So with a net income of just over half the official dole rate, I cleared the overdraft over a couple of months and stopped paying the charges.

But I had at least one advantage: the Nationwide's charges were £20, compared to the £35 or even more that everyone quotes in this debate. And therein lies the point: if your bank's charges are outrageous, then stop whinging and take your business elsewhere!

[the end is a bit nigher]

Martin Lewis said on the radio this morning he had a lot riding on this. Just seen him speaking outside the court desperately trying to sound like a people's champion rather than a tit who has just lost.

[chevin]

If you want people to live beyond their means repeatedly then you bail them out.

or you help solve the real problem.

We are all different. Some need the 'stick', some need the 'carrot'. And guess what? The rest need a quadzillion combinations of the two. That you only acknowledge the 'stick' proportion shows up your flippant thinking. Until you recognise all the others you will never get close to fixing society.

[porca misèria]

Does that include the way most UK banks sting you if you use your debit card overseas, the uncompetitive exchange rate and the accounts that they manage to hook people into paying £10 a month for the privilege of getting a discount on a crate of dodgy wine and some worthless insurance policy?

How about the "underfunding" charge applied by the likes of Scamtander on their current accounts?

I would rather pay a small transaction fee to fund the ATM network than have those who can least afford it stung with hefty, unjustifiable charges that subsidise the rest of their rather feeble operations. The concept of being fleeced by the custodians of ones money (and rather large source of their investment funds) is to say the least unpalatable and to put it strongly, downright disgusting.

In the absence of any real competition in the area of money, the banks are virtually free to impose any spurious tariffs they please on the users of their services.

Another case of missing the point.

My bank doesn't sting me for using the debit card overseas. If yours does, stop whinging, and take your business elsewhere!

[shindigger]

This wasnt a paypal error. Paypal purposely change your default to your bank account because then they get all the money and dont have to pay a credit card surcharge to a third party. Thats why it defaults to that, and why when you try and change it is presented as the wrong thing to do and you can only change it each any every time, you cannot change the default.

I dont see how this was any fault of Natwest, and you just seemed to try to punish them for Paypal being greedy and you not noticing. Natwest always gave me a pre-arranged over draft limit, its around £1000. I have no idea what this costs, and I have never used it, or asked for it. But its there.

If £109 makes you overdrawn then I respectfully suggest you are sailing too close to the wind, and Id build up a bit of a buffer whoever you bank with.

Injin seems to live in a fantasy world where it is wrong for people to charge more for a service than it costs to provide that service. Im surprised he has anything to say really, as there is no such thing as money. lol

No need to respectfully suggest anything. Piously maybe.

This account existed purely to receive Paypal payments and nothing else. I run my regular current fine thanks very much. (Current OD facility is £2800 should i need it).

I (as im sure everyone else did) had to go through all this account verificaction rubbish to comply with money laundering regs. At the end of this Payypal proudly announced i was a gold starred uber member. I must have missed the bit about my payment method being switched as a result of this chicanery. As you can see i did accept responsibility in my original post.And am philosophical re the £109. The bit about "paypal error" was sposed to be a monopoly based joke.

Paypal led me down the garden path to this situation. Sure their t&cs will exonerate them.

You assume far too much.

[Sledgehead]

if your bank's charges are outrageous, then stop whinging and take your business elsewhere!

But would that not oopen the door to more competition, ignite a price war, cut bank profitability, force bank restructurings and wage cuts, cause share price underperformance?

You know what this could well mean: a crash in performance related pay for bank bosses with contracts tied to stock price performance. Do you really want that????? :angry:

( )

Of course not! Far better to let the ceos blame nasty courts for lower profitability and have them wack charges on us all to keep the bottom line up, the share price afloat and performance related pay blistering ahead!

( :angry: )

[Pindar]

Another case of missing the point.

My bank doesn't sting me for using the debit card overseas. If yours does, stop whinging, and take your business elsewhere!

I already have - I moved out of the UK. If I transfer money from my Norwegian account to my UK account, my Norwegian bank charges me a reasonable fee of 50NOK. I get charged more by my UK bank for the privilege of *receiving* the funds - funds which they are benefiting from as they can lend it out and invest with it. I think First Direct are supposed to be one of the more competitive UK banks, yet their charges are still grossly disproportionate to the actual effort and cost involved in administering an electronic system.

[Stars]

No, because that payment is not automatic. The bank can choose to loan you x or not. If they do choose to loan you x then they can only charge you the cost.

It makes no odds - the agreed price is still the agreed price

Why?

Because they didn't have to incur it - that was their choice.

Yes, they choose to do it - for a pre agreed price . That is called trade. For convenience the contract with the bank has already agreed the price of any borrowing that takes place, so that money can be borrowed quickly without a new contract being drawn out. There is nothing more peculiar in this arrangement than (say) agreeing to pay for any drinks you consume in a bar in some foreign clubs and the first drink being cheaper than the third and the bar owner having the option to deny you service.

What a bizzare twisty path you are on all of a sudden

[porca misèria]

But would that not oopen the door to more competition, ignite a price war, cut bank profitability, force bank restructurings and wage cuts, cause share price underperformance?

You know what this could well mean: a crash in performance related pay for bank bosses with contracts tied to stock price performance. Do you really want that????? :angry:

Maybe it would.

If the whingers changed, that might make a difference on the margins. If the silent majority changed, it would force the more complacent banks to get more competitive[1]. The key point is that you have the choice!

[1] bailouts aside - I'm as pissed off as anyone about the massive devaluation of my money.

[shindigger]

That's a bit unkind. £109 is a lot of money to some, maybe even more than a week's wages. In credit is in credit, I can't see why you should have to leave "dead" money to legislate for other's potential ****-ups. Besides, banks don't like it if you leave a permanent balance in your current account, I guess now we know why.

eight

Cheers for the sentiment.

Happily the £109 charge was not a big issue in so much as this account was only run for paypal purposes only.

I run my main current account free of any Paypal meddling.

Looks like i had the right idea on that score. Just didnt realise theyd changed my payment method when i "upgaded" my account.

A solid gold ****** up from wherever you look.

[Danny Deflation]

Martin Lewis said on the radio this morning he had a lot riding on this. Just seen him speaking outside the court desperately trying to sound like a people's champion rather than a tit who has just lost.

He hasn't lost. The OFT have won twice previously, this is the banks' first victory - and it is primarily on a legal point about fairness. The battle will continue, I suspect, for months if not years.

I like Martin Lewis. He has encouraged people to question penalties levied by banks, instead of just accepting the banks' bullying like everyone used to, and he has helped to make financial acumen more accessible to the masses.

[shindigger]

£109 is a lot for people who pay £70 a month smoking, and £50 a month on a mobile phone contract, and blow £50 on night out,, I tend to find.

How is money in the bank dead in any way? Something happens you draw it out, surely the money frittered away is the dead money?

Banks not wanting a permanent balance? What are you talking about? Totally made up. They love money in current accounts as they pay no interest on it!

I respectfully ask you to stop posting shit about people you know ****** all about.

Thanks Johnny.