Please keep in lane Banks super High wage >
We all like honesty – Honesty I here you cry; whats that? – (clear throat) – We all want to know what is going on especially with your hard earned cash. We all want a fair warning with bank interest rate rises. We all want more control with our finances. I don’t ask for much do I? Most of us don’t know where our money goes – We are too busy to run-around down blind alleys of Call Centres, ideal for those of you wanting early coronaries. It is understandable that bank call centres are obviously not there to help, they are there to pad-out their own profits on 0845 Premium call rates.
The Bank Association is planning to introduce a monthly fee for those individuals who are paying wages into their account at below 1000.00 a month; the 21st century could introduce the ‘cash in the mattress’; again. On this notion alone, this would be a true indication that elitism is in favor – profits over people. If implicated, it would make a mockery of what the ‘Office of Fair Trading’ stands for.
Abbey is the first bank to publish their new terms and conditions; shows their eagerness as an attempt to strengthen the plausibility of Abbey’s argument that its large unlawful charges are actually lawful charges for the banks service. Mostly this involves a lot of extra waffle in extra small text, plus some name changes e.g. when you exceed your agreed overdraft limit the bank now calls this using Abbey’s ‘Instant Overdraft’. It doesn’t surprise me that yet again this bank is ‘pulling the wool over their customer’s eyes’. Forgetting completely that clients do have a right to ask for how the charges are made up; this seems to be a very difficult task for all banks to make public.
What is published in a mark to confuse you, and in an unsubtle attempt to justify its charges, it has changed its fee structure to a more potentially opened to misinterpretation tier system; that does not solve, nor is realistic, it’s still daylight robbery. The cheapest charge of 5 is at least double the actual fee.
Here’s how the fees are made up:
The proposed penalties for going over your agreed overdraft
Size of transaction Fee
0 – 9.99 5
10 – 19.99 15
20 – 29.99 25
It is carefully planned out that the 30.00 plus – Direct Debit Mandate includes the majority of all mandates are in the top fee bracket – 5.00 more than the original 30.00 customary charge. At first it looks quite ‘Derren Brownesque’ accept that this is not a mind trick, it is a blatant smokescreen. There is also a charge of 25.00 per month for being over your agreed overdraft limit.
This is how it is made up
The major facts for Abbey customers to remember:
It’s the size of the transaction that dictates the fee, not the amount that you go over your overdraft limit.
You’re charged for each transaction that takes you over, or further over, your agreed overdraft limit.
In addition to the above, you’re charged 25 for each month you’re over your agreed overdraft limit (up from 20) and 28.7% APR interest.
So, if you have a 30 transaction that takes you over your arranged overdraft, and then you have a further 30 transaction, you’ll be charged 95 (35 + 35 + 25) in the first month, and 25 per month (plus interest) thereafter till you get back within your limit.
Now that this solution is being implemented; does it mean that ‘Free banking’ is going to be put on hold; If Abbey is digging in to defend its penalty charges? If, that is the case, charges for everyone is probably some way off. It makes sense too; because of the Office of Fair Trading super-claim, the banks might have up to 5 years before they need to make any serious changes.
During this time-span banks may add further charges on; either bank accounts that have become obsolete or for those accounts that have fallen short on paid-in monies per month. The possibility of a threshold changing from 250.00 – 500.00 – to 1000.00, over a period of time, I hasten a guess that the first level could be introduced within three years.
It is common knowledge that a bank has an infinite number of ways to charge us, so it’s going to get much harder to compare current accounts. We’ll find it harder to work out which account is best for us, as things get much more complicated; even with the internet, it is time consuming, and time is not what the hard working UK citizen has plenty of.
Why banks love complicated products, I can only envisage this as a purposeful smokescreen, geared up for the means to increase their already inflated profit margins. Most people don’t understand what they’re being charged, so it gives banks a chance to increase their profits; regardless if they are providing a good service or not. The average annual charges rise to 120 or more; this does not include the interest that is incurred.
In the UK, we don’t have free banking. We pay for our account usage, by just waiting 3 days for a cheque to be processed, or money transfers, foreign, moneygram conversion just to name a few. The list just keeps growing, so you could say, why are banks making a big song and dance over their illegal penalty charges? Having seen at first-hand how the system unfolds itself. It is totally due to pure arrogance. It all looks like it’s a bankers’ life. No wonder many people choose the bankers route to success. I question their integrity and you certainly won’t get one winning ‘Mastermind’; but generally most are friendly, well you’ve got to be good at something. Working your way up the ladder is a pure endurance test so you might as well make the most of it when reaching the dizzy heights of the banking hierarchy.
Office of Fair Trading’s role
The Office of Fair Trading (OFT) is currently expanding its penal bank investigation to cover the transparency of all existing charges. The investigation will also look at the consequences of its actions if it manages to stop banks charging penal fees.
OFT the bigger picture
Nothing is going to be learn’t from this investigation. It is likely that the OFT could lose credibility by delving in too much; then again does it matter? it is only yet another governing body investigation that is in place for the supposed good of the public. It is obviously afraid of putting a strong message across, whatever is found in the investigation. Not everyone has asked back their penalty charges nor even understands the illegal system. Getting a balance is vital though by getting a fair balance does not solve anything. The banks have OFT exactly where they want them.
Propaganda wise any form of investigation that banks would claim to be improving their services’, is a very good thing. There appears only one winner, the banks; If penalties are reduced or quashed, these people will have to start paying more for their own accounts, so that the banks can maintain their inflated profit margins. The loser could be the unlawful charges; whereby the decision could be much weaker and therefore would be painful for those late in claiming back charges.
On the other hand, the OFT can certainly justify the wider investigation, because part of its remit is to ensure that there is a healthy competition between businesses in the same industry. The consumer body will be concerned that the banks will use any ruling as an excuse to increase their profiteering.
Unless it comes up with something innovative, the OFT has two options on bank charges: warn banks to cap them (as it did with credit cards) or take the banks to court over them.
The OFT will be hoping to come up with a win-win solution where bank charges are quashed or greatly reduced, the overall cost of banking doesn’t rise, and the costs of banking become more transparent. Achieving all this is impossible. If banks have to reduce their penalty fees and are forced to be transparent about their existing charges, they’ll simply come up with all sorts of new ways to charge people.
In fact, I believe that banks will do this anyway, as, one way or another, penalising people for bank charges will become a none entity.
I’m astonished that banks have some work ethics – but it appears they do. They have to show an eliment of co-operation to the UK public’s ‘public opinion’ even though it more than likely prove to be a facade. I feel strongly that the poverish and needy should not pay thousands to subsidise the accounts of other, wealthier people. One unsurprising statistic is that there are more poor people than rich in the UK, so it is in the banks interest to still take from the poor. Makes good business sense, and it broadens the bridge between the poor and rich.
More services are sold to you over the phone when you are already paying for a premium rate line (as said earlier) connection whereby the bank prospers for unfortunate mishaps or for their own mistakes; you ring up just to clarify your identity or new card number; the bank service centre uses every opportunity to sell you amples of services and insurances. Please note many are inplace to catch you out. Before agreeing to a DDM read the policies first-hand rather them being read to you, they are surprisingly different.
That little bit of extra help – No pun intended.
May I clear my throat – I hope the OFT investigates or does at least 75% of there job in response of actually keeping some credible recognition for the sake of the publics interest. I’m not a believer in expensive and very long investigations – once heard and then forgotten – Nothing thereafter – Why in the UK do we put up with extreme negligence within sensitive matters in Financial organisations? At least OFT is preparing a little bit of help, even though the findings may become very transparent and open to abuse.
You shouldn’t expect a leopald to change it’s spots; especially when there are many spots to change.
What I really really want is a non – target orientated – Honest – Non corrupt – banking ethic that is there to protect their customers from increasing fraud and of themselves. I feel loyalty is underestimated and on all of these counts the Banking Association falls very short.
Thank you for reading – I would like to hear from you – if you have any thoughts.