The Banks Win...:(

[east_of_the_sun]

I don't normally agree with Martin Lewis as I think a lot of his campaigns seem to be about abdicating people of any responsibility for their own financial situation, but I do actually largely support him in this one.

If the banks don't want people to have unauthorised overdrafts, then why do they allow them? They could just reject the direct debit/bounce the check etc but instead they process the transaction and then charge ridiculous penalities which I do not believe bear any relation to their actual costs. If a DD goes through which pushes your account £1 overdrawn, this can in some cases amount to £100s in charges over the course of a few weeks - how on earth is someone already on a low income supposed to repay this?

As for the argument that stopping these charges will result in the end of free banking for the rest of us, I don't really get that either? If there is a cost to the banks of providing general current account services to consumers, why shouldn't the cost be charged to all consumers? Why should it be the poorest who have to pay the fees for all of us?

[Weltchy]

Retail account sweeping to a minimum balance is quite common in Eastern Europe - I wonder why no banks in the UK (that I know of) offer that service? If they did I think I'd move in a flash.

I've got caught by this. I setup a standing order to transfer £1000 a month between my current account and the savings account which is linked to it. The standing order has caused my current account to go overdrawn a couple of times, charging £20 each time for the pleasure because I've manually completed the transfer and forgotten to amend the standing order.

[TheFaQQer]

2. The banks administer the overdraft charge on 1 account whilst I have thousands of pounds in another account. The argument that I owe anybody any money in that situation is stupid.

At the end of the day, the banks make money by paying creditors interest and lending the creditor's money to debtors at a higher interest rate. A creditor who temporarily becomes a debtor on 1 account should not be penalised. Until now, I've always had the overdraft charge reversed by threatening to withdraw my money from my savings account, as they would lose a lot more money by not being able to lend out my savings.

Try First Direct - they rang my parents to tell them they were about to go overdrawn, and should they just transfer the money out of the savings account instead?

Now that's customer service.

[lilelvis2000]

I got a 35 quid charge to pay a 6 quid dd. I'd rather they had just cancelled the dd. But that wouldn't have earned them 35 quid would it.

Isn't there are charge for a failed DD??? And then there's the issue with the utility (or whatever) who might charge you....it goes on and on...Modern life is just too damn stressfull.

[lilelvis2000]

I don't normally agree with Martin Lewis as I think a lot of his campaigns seem to be about abdicating people of any responsibility for their own financial situation, but I do actually largely support him in this one.

If the banks don't want people to have unauthorised overdrafts, then why do they allow them? They could just reject the direct debit/bounce the check etc but instead they process the transaction and then charge ridiculous penalities which I do not believe bear any relation to their actual costs. If a DD goes through which pushes your account £1 overdrawn, this can in some cases amount to £100s in charges over the course of a few weeks - how on earth is someone already on a low income supposed to repay this?

As for the argument that stopping these charges will result in the end of free banking for the rest of us, I don't really get that either? If there is a cost to the banks of providing general current account services to consumers, why shouldn't the cost be charged to all consumers? Why should it be the poorest who have to pay the fees for all of us?

Because the twits that think "free" banking is really free. And apparently having to pay, say £5, a month for an account is sacrilege. While in Canada...its the norm. And if you have a overdraft set up - you get dinged the moment you enter overdraft - and pay interest as well. There's no way you can go beyond your limit either.

[d000hg]

As for the argument that stopping these charges will result in the end of free banking for the rest of us, I don't really get that either?

It's a stupid argument. They're saying banking is unprofitable except for penalty fees, and relies on them to survive. The £billions banks make each year clearly contradict that. Banks make money by lending money at higher interest rates than they pay to savers, everything else is trimmings on top... "Champagne for the Shareholders" as the advert says

[lilelvis2000]

Some of us here are contractors, don't you know.

Technically I'm an employee and pay myself a regular salary via a standing order I set up. I stopped contracting a couple of years back and now consult and setup hardware and build systems for local clients. This means I can see the kids to and from school everyday....and no long commutes either. Wheee!

[Spacecadet]

I've never understood how a court can prevent someone from appealing...

If the courts believe that all relavent evidence has been presented to the court and there are no new circumstances which may tip the case the other way then the appeal will generally be blocked.
Imagine if appeals couldn't be blocked by the courts, there would be no time for new cases!

Of course the decision to block the appeal can be petitioned against if any new evidence was to arise. So now it's up to the OFT to go back and gather fresh evidence to present to the courts to get an appeal.

[BolshieBastard]

Bleeding incredible how some people want to be spoonfed in this country then bleat like lambs when they have to pay up.

There's no reason why anyone who takes an unauthorised overdraft shouldnt have to pay these charges.

manage your ******* money and dont expec me to subsidise you!

If you dont spend what you havent got, you wont pay interest. And here is some other news, dont spend over the bank limit you have agreed to with your bank and your bank wont charge you extra!

now there's a thought.

TBH too many people jumped on this bandwagon. Im more than happy they lost. I bet most of them have already spent what they thought they were going to get back from this litigation. Ha, serves them right.

[gingerjedi]

I don't normally agree with Martin Lewis as I think a lot of his campaigns seem to be about abdicating people of any responsibility for their own financial situation, but I do actually largely support him in this one.

If the banks don't want people to have unauthorised overdrafts, then why do they allow them? They could just reject the direct debit/bounce the check etc but instead they process the transaction and then charge ridiculous penalties which I do not believe bear any relation to their actual costs. If a DD goes through which pushes your account £1 overdrawn, this can in some cases amount to £100s in charges over the course of a few weeks - how on earth is someone already on a low income supposed to repay this?

As for the argument that stopping these charges will result in the end of free banking for the rest of us, I don't really get that either? If there is a cost to the banks of providing general current account services to consumers, why shouldn't the cost be charged to all consumers? Why should it be the poorest who have to pay the fees for all of us?

How would it be fair to have it any other way? When you deposit they give you money and when you borrow you pay them, that's how banks work.

I don't buy the 'poor' argument either, it's patronising to label them all feckless as a majority understand the rules and avoid the charges by budgeting accordingly. Plenty of relatively well off people still fall foul just for being rubbish with money.

I'm always overdrawn but never pay penalties, if the ruling had gone the other way I'd imagine banks would be demanding immediate and full overdraft repayments which would leave me up tulip creek at the moment, they'd start charging for basic accounts and ATM fees would be back. Why should people who've conducted their business within the rules be penalised?