Tesco introduce rip-off Current Account

[Conniff]

Tesco has today announced the introduction of a current account. It will cost £5 per month unless you deposit £750 per month.

 

 

Although it will pay interest on credit balances, this is one not to get involved with unless you can guarantee funds deposits exceeding £750 per month every month or have funds left over at the end of each month.

 

 

There will also be an 18.9% charge on arranged overdrafts plus fees on top of that for unarranged.

So if you went over by £50 and could only afford to repay at £15 per month, you overdraft will continue to increase plus the fees on top.

Edited June 10, 2014 by Conniff

[renegadeimp]

I wouldnt go near a supermarket bank account anyway :/ far too much risk involved.

[Klandestine]

REALLY? It doesn't seem like a bad deal to me...

 

• It has a reasonable monthly deposit requirement (but there are easy ways to circumvent this anyway).
  
• There are other interest-paying current accounts which might be better options (TSB Classic Plus, Club Lloyds, Santander 123 etc) but this account offers an easy 3% interest on £3000. And you earn extra Clubcard points when you spend.
  
• The overdraft (both arranged and unarranged) actually seems quite simple and competitive.
  

 

Arranged overdrafts only accrue 18.9% EAR and there are no fees.

The same 18.9% EAR applies to unarranged overdrafts but there is also a £5 charge for paid or unpaid items (up to a monthly maximum of £50).

 

I wouldn't even say that banking with them would be "risky". They are regulated in the same way as the mainstream banks. They are covered by the Financial Services Compensation Scheme (FSCS). Current accounts may be a new area for Tesco Bank but they're hardly a newcomer to the world of retail banking (i.e. savings accounts, credit cards, loans etc.)

[Conniff]

We are 'Forced' to have our pay and pensions put into a bank, we have no choice. Only those that have more than enough to live on will gain anything but for the others, they will be taking away £5 of money that they haven't got before they have a chance to draw it.

 

 

Should someone go into unarranged overdraft, it could work out very expensive, so hitting the not-well-off again.

 

 

It matters not what anyone says, this isn't a bank account for the ordinary person, this is a bank account to make big profits for Tesco full stop.

[JJShops]

I wouldnt go near a supermarket bank account anyway :/ far too much risk involved.

 

Totally agree I wouldn't get an account through a supermarket, even if they offered a slightly better account although in this case they don't!

[Klandestine]

We are 'Forced' to have our pay and pensions put into a bank, we have no choice. Only those that have more than enough to live on will gain anything but for the others, they will be taking away £5 of money that they haven't got before they have a chance to draw it.

 

 

Should someone go into unarranged overdraft, it could work out very expensive, so hitting the not-well-off again.

 

 

It matters not what anyone says, this isn't a bank account for the ordinary person, this is a bank account to make big profits for Tesco full stop.

 

If you don't have income of less than £750 per month (i.e. a take home salary of £9000) then maybe this account isn't for you. The majority of working people earn more than that though.

 

However, you can work around the monthly deposit requirement by transferring money into the account and then transferring it straight out again. Can be done in less than 5 minutes online.

 

Unarranged overdrafts usually are expensive (for a reason too). But they can easily be avoided by not going overdrawn.

 

I would be very surprised if Tesco wasn't trying to make money. But that doesn't mean people can't benefit from the account.

 

 

 

You sound as though you have a huge chip on your shoulder. You can make your banking work in your favour you know. If you want some advice about that feel free to post a thread.

[Conniff]

No chip on my shoulder, none of that affects me.

All that I said is from an outside observation. What I can't stand is the working class, those on benefits and pensioners being fleeced.

[Klandestine]

Fair enough but let's be honest this account isn't even aimed at some of those groups of people you just mentioned. That's the purpose of the deposit requirement/fee waiver.

[Conniff]

But Tesco a 2 bit store is catering for those with not a lot so they will try and trap them into it knowing they are most likely to go overdrawn.

[citizenB]

We are 'Forced' to have our pay and pensions put into a bank, we have no choice. Only those that have more than enough to live on will gain anything but for the others, they will be taking away £5 of money that they haven't got before they have a chance to draw it.

 

 

Should someone go into unarranged overdraft, it could work out very expensive, so hitting the not-well-off again.

 

 

It matters not what anyone says, this isn't a bank account for the ordinary person, this is a bank account to make big profits for Tesco full stop.

 

I agree with Conniff - most of us have no choice as to how our income is paid to us.

 

The banks then want to charge us for using our own cash !

 

Essential expenditure such as mortgages/rent/utilities/council tax all want to be paid via direct debit. They charge you more if you want to pay by any other method such as online transfer/standing order and god forbid.. cash !!

 

The Direct debit system is a good one if you have a little extra over each month at the end of your budgeting - if you dont and you have to "manage" your money going in and out, then it could cost you if money going in is a little late and the DD is either paid or not paid.

 

This system is geared toward the companies because they can see how much money they have coming in and can plan for advanced expenditure.. so it is nothing to do with helping consumers.

[citizenB]

Fair enough but let's be honest this account isn't even aimed at some of those groups of people you just mentioned. That's the purpose of the deposit requirement/fee waiver.

 

Precisely, the account isnt being offered to "everyone" so how is it an alternative banking system?

[Klandestine]

But Tesco a 2 bit store is catering for those with not a lot so they will try and trap them into it knowing they are most likely to go overdrawn.

 

That's rubbish really. Tesco has the largest supermarket share. They cater for more than "those with not a lot".

 

The account is clearly aimed at those with a monthly income of at least £750. It's a bit ridiculous to even claim that it's their intention to trap "those with not a lot".

 

Anyway, contrary to the opinions on this forum, banks don't want you to live in your overdraft. Overdrafts are meant for short term borrowing of relatively small amounts. A customer that lives in their overdraft presents a huge risk to the bank in that there is a good chance they won't be able to pay the bank back.

 

The banks then want to charge us for using our own cash !

 

I don't get charged anything by any of my banks (as long as I'm in credit). Yet I benefit from convenience, security, detailed records, some form of purchase protection etc. which I wouldn't get if I only dealt with cash.

 

Consumers do also benefit from Direct Debits too. For example, my credit card statements get paid in full without me having to deal with anything. If I made manual payments but one month I forgot to pay my bill I would be hit with a late payment charge.

 

Precisely, the account isnt being offered to "everyone" so how is it an alternative banking system?

 

It seems to cater for the majority though.

[Conniff]

Market share doesn't make them a quality shop. Frankly their products are junk and the quality of their food disgusting. Their products are made down to a price not the other way around and that is where they go wrong. Cheap food is poor quality food.

 

 

I don't get charged and I don't use an overdraft, but that doesn't mean others don't, some have no choice except go that way or take a payday loan.

 

 

Sorry, no matter what you believe or say, Tesco are only in this for the money and the way to make money is drag in the little man.

If they weren't they would be charging the same for overdrafts as they are giving in interest. 20% plus a fee, what a rip-off.

[Klandestine]

Market share doesn't make them a quality shop. Frankly their products are junk and the quality of their food disgusting. Their products are made down to a price not the other way around and that is where they go wrong. Cheap food is poor quality food.

 

Nobody has suggested that it does. I don't know why you're suddenly talking about the quality of a supermarket.

 

I'm not a fan of Tesco as a supermarket either. But the quality of their products is nothing to do with their banking services.

 

I don't get charged and I don't use an overdraft, but that doesn't mean others don't, some have no choice except go that way or take a payday loan.

 

Bank charges are a choice determined by the way you operate your account.

Even if you can't make ends meet you can avoid bank charges.

 

Sorry, no matter what you believe or say, Tesco are only in this for the money and the way to make money is drag in the little man.

If they weren't they would be charging the same for overdrafts as they are giving in interest. 20% plus a fee, what a rip-off.

 

I never said that their goal wasn't to make money. The ultimate goal of any business is to make money. That doesn't mean that customers can't benefit from the account though.

 

Compare the arranged and unarranged overdraft of the Tesco account to other banks and it is fairly competitive. I think perhaps they were trying to gain a few disgruntled Barclays customers after their charging structure changes.

[Conniff]

Who will use a Tesco account, certainly not those with money, I can't see David Beckham flashing a Tesco cheque book. So if it's not the rich, then who is left. Say no more.

[Klandestine]

Who will use a Tesco account, certainly not those with money, I can't see David Beckham flashing a Tesco cheque book. So if it's not the rich, then who is left. Say no more.

 

What an odd response. You didn't address anything I mentioned in my previous reply to you. I get the feeling that you don't actually read the posts that you are replying to.

 

And I have absolutely no idea why you are telling me "say no more", as though you've just given me a sound logical conclusion!

 

Maybe some of the people I have already suggested in my previous posts will want an account with Tesco Bank:

• Normal working people
  
• Those who collect Clubcard points
  
• Those who want to earn some interest
  
• Those who go overdrawn occasionally
  
• Those who are fed up with the mainstream banks
  

[Conniff]

What's the betting you work for Tesco.

 

 

I've finished here now, this is wasting server space.

[Klandestine]

What's the betting you work for Tesco.

 

 

I've finished here now, this is wasting server space.

 

I don't work for Tesco but I would've been willing to bet that you'd pipe up with that response.

 

It's good to know that you think information which people can use to establish whether this current account will benefit them is a waste of server space.

 

And you originally said that you didn't have a chip on your shoulder. Hmmmmm.........

[goodatresearch]

Agree, very competitive account if you deposit £750 per month which you can do if your a full time worker on minimum wage. If you can't manage on £750 pm then any bank is going to charge you. You get nothing for free and the charges don't seem to be higher than any other bank.

 

My family isn't footballer rich by the way but don't go overdrawn.

[Conniff]

Sorry but my bank charges me nothing, zilch.

[SabreSheep]

As an old insider The company treats its staff with utter contempt, so what do you expect them to do when it comes to their customers.

 

They used to have company mantra "Treat your staff well so they treat the customer well" Most TESCO values got lost or dropped in the early 2010;s

[goodatresearch]

Really, a bank allowing completely free overdrafts? Lucky you.

 

Normally banks draw you in with a free overdraft facility for a limited time and then add interest and/or monthly fees. Perhaps you could reveal the account provider and account name to assist anyone with a low income.

[Conniff]

Really, a bank allowing completely free overdrafts? Lucky you.

 

Normally banks draw you in with a free overdraft facility for a limited time and then add interest and/or monthly fees. Perhaps you could reveal the account provider and account name to assist anyone with a low income.

 

 

Who are you addressing ?

[goodatresearch]

Unfortunately a lot of large supermarkets seem to treat their staff poorly. In particular, I cant understand why they pay most of their front line staff minimum wage when company's like aldi pay over mw.

 

As for banks, all they care about is profits and they couldn't care less about good customer service.

 

At the end of the day, you just have to go with a bank that best suits your needs. If you need an overdraft go for one with the least fees/interest charges. If you don't need an overdraft, go for a simple bank account. In other words shop around.

[renegadeimp]

Discount stores do not have the overheads like every other supermarket does. They have the old attitiude of get a low amount of staff in and get them to do every job in the store. Even the managers do the same work as the staff. Then they pile the stock high and sell it cheap.

 

Remember, discount stores are no frills either. No toilets, no cafe's, rarely any space to pack bags. In aldi for example, the cashiers arent allowed to help pack bags. They have a minimum scan rate of 46 items per minute. If they miss their target a set number of times in a month, they get a disciplinary. So they are forced to get as many people out as possible, thereby raising profits.