Doesnt Anyone Else Think This is Dangerous?

[jaysmith]

I agree with everything which has been said about excessive bank charges but isnt this just sending out the signal to people not to worry about trying to keep there finances in order and just go overdrawn as in the end they'll get there charges back?

 

I think personally we are going down a rocky road and people need to watch out because sooner or later the banks are going to hit back one way or another whether its fighting these claims in court, incresing authorised overdraft charges, reducing interest rates on savings account or increasing personal loan and credit card APR's and in the end how ever much we kid ourselves they will win whether that means closing our bank account and black listing us or just charging higher rates

 

I think we all need to try and encourage the bank to reduce the charges to a more realistic level instead of threatening them with legal action.

 

Dont know whether anyone agrees with me or not but i'm sure i'll find out soon!

[johnspeehs]

yes you probably have a point but but when i tried to sort my account out they bullied me into putting my overdraft account onto a personal loan with payments we couldnt afford. this meant we fell into arrears every month till the low point in feb where my loan payment was £380 and the charges were£690. i think the words vicous and circle come to mind, none of us do this on purpose we just cant get out of the cycle while they keep adding the ridiculous charges. we have 2 kids who need fed and clothed, dosent leave a lot at the end of the month for ilegal charges.

[andrew1]

Unlawful, not illegal. It is not a criminal offence as such. This is not dangerous at all, it is putting something right which everyone has accepted as the cost for charges which the banks have imposed and got away with for years when they are not legally entitled to do it. - It's not allowed! First things first. Correct the unlawful act by getting the banks to abide by the laws of the land, then educate people to act responsibly thereafter, which comes back to your point. Of course people might get the wrong message, but then they have missed the point altogether. When you read through this forum you will realise that the banking world have brainwashed us all for so long when they have possies of lawyers advising them that to charge £32 to send you a letter for going O/D only costs them 50p. They are not allowed in law to make a profit from a penalty charge only from a service. Period! They can only charge for actual or liquidated loss so put the banks right and then do what we should all do and only use credit sensibly and in the knowledge that what we are being charged is legally being charged and not a profit machine for shareholders elsewhere. Nothing dangerous in that matey.

[pmhread]

People are taking the banks to court left right and centre for extreme charges and they still haven't reduced them. Do you think they will reduce them if we sit there nicely saying please sir can we have more of our money?

 

No-one on here will argue about them charging a fair price (ie what it actually costs them plus a little) but thats not good enough for the banks who need to find ever increasing profits to keep their shareholders (not the customers!) happy.

[fivelaws]

Yes. And also no.

 

I know I am guilty of not being the best money-manager in the world, but when you are on a low or low-ish income, having large sums of money disappear, thanks to penalty charges means you can't easily recover the situation. I recently had a £5 direct debit bounce because I was £3 from my overdraft limit. The bank charged me a total of £89 - £39 for the bounced DD and £50 for now being over the overdraft. To make maters worse, the DD was to my credit card, who promptly charged another £25 for late payment. Bearing in mind I only actually owed the credit card £3.11 which had been rounded up to the minimum payment, I was now £114 short for *in reality* being 11p in debt... Whichever way you cut it - that situation cannot be fair. And this is progressive, because the following month I incurred further charges because I was "a bad account manager". And don't think this is unusual - you will hear hundreds/thousands of such stories on a forum such as this.

 

The banks have allegedly made about £3bn a year in unlawful penalties and it is obvious that the majority of those will come from low or low-ish income families - the very segment that actually can't afford to pay.

 

My business banking isn't free (far from it), but the costs are obvious and transparent. I know it costs 23p to pay a direct debit and 68p to pay by cheque - I can decide the method based on cost and I know exactly what the charges would be. I know for a fact that my personal banking, done on a pay-per-transaction method, would be less than £5/month - or about as expensive for 2-years as going 11p in debt in one month. Which would you rather?

 

And finally - The banks are a business. If they are forced to abandon one method of making money, they will of course try to find another to sustain their shareholder expectations. What this will be, we can only guess. But the UK banking sector is very lucrative - if the current incumbents decided to throw their toys out of the collective cot and charge all of us £50/month to have a bank account - there are plenty of other banks on the horizon who will gladly take the customers on better terms...

[MARTIN3030]

Unfortunately it has taken people like Dave to try and bring the banks to change their practices but they do not listen.

 

The purpose of this site therefore is to mount a collective effort to let them know they have had their day.

 

Of course there are the risks of account closure.........and we DO know that they are already devising other ways to recoup money they now are having to pay out as was pointed out last night.

 

However if any of those measures are illegal then they too will be challenged.

 

There are currently a few members who have applied to the court to have injunctions against their account closure this is a road that may prove important for many claimants.

At the moment its unexplored territory but it IS being addressed.

 

By working together we will further put pressure on the greedy banks.........

 

As with many things there ARE risks but the end results and implications for thousands must be seen as worth that risk as in most cases there is only going to be one winner !!

 

[Mal]

I agree with everything which has been said about excessive bank charges but isnt this just sending out the signal to people not to worry about trying to keep there finances in order and just go overdrawn as in the end they'll get there charges back?

 

 

The answer for the banks is quite simple. If the money is not there don't let people have it! and don't charge them just because they asked for it! That would be HELPING but we all know thats not the way they work

 

Mal

[MARTIN3030]

There is a consensus amonst a few that they Will be addressing this point,and as many have said,the banks need to sustain the profits they have enjoyed to keep hold of their shareholders.

 

A lot of the advice given here is to try and keep the account looking good if action is pending (especially threats of closure) as it can then be used as an arguement that the account has shown improved management.

 

Thats not to say that some will take this as a signal to be grossly negligent with their accounts..............this is a different scenario and one which I am sure is bothering the banks a lot more than the thought of paying past penalty charges.

 

[breadline]

reloan and reloan and reloan, £8000 later and 2 loans given whilst unemployed, I never even had the option of insurance cover.

 

It took me to be stuck in bed for months before they told me there was a reduced payment system available to me.

 

They are monsters, quiet happy to bulldozer them to the ground. Im back to good old cash in my pocket and its all mine...... and its lovely.

 

BL

[MARTIN3030]

And soon you will have more in your pocket........without a loan !!