Bank Charges Have NOT Got Cheaper

Sorry, but a more obvious recommendation would be to avoid any bank (and Barclays has always been one of the worst offenders) that goes in for this sort of nonsense.

TMF is to be congratulated for helping Barclays Bank cause its customers to think. I find it difficult be believe that if people read the small print, in all contracts, that there would be so many folk who feel they have been treated unfairly.

Let's agree the print has to be small; the rain forests will not last long if it isn't. Let's agree that probably only lawyers like reading and writing these contracts. But not reading them, just because you don't like doing so, is rather foolish.

8I have recently joined the 'Think Banking' which is from the Newcastle Building Society in conjunction with The Royal Bank of Scotland. It's the first bank I know of that actually works for you as apposed to against you. There is absolutely no bank charges for going overdrawn or bouncing direct debits. Yes you heard right, no bank charges.

When you open an account they give two accounts, a bills account called salaries and a card account, conveniently called card account. These 2 account run alongside each other, monitored by Think Banking. You setup DD's and Standing orders and they do all the rest. Money gets paid into you account and anything required for DD's or suchlike the required amount is sent to your salaries account the rest goes to you card account for you to do what you like with. You automatically get a debit card when you join.

Now the only charge you get is a nominal monthly fee of £12. I know you think it's te same as a bank charge but considering the amount of work they do for you it's well worth it. You can even transfer money from you Bills account to your card if your short. They just delay paying the DD until money is available.

On a personal note since being with them I've never had so much money for myself and not have to worry in the slightest about bills. They really do take the worry out of banking.

I was with barclays for many years but left 7 years ago. I got fed up with their petty bank charges. Each time they charged me I would challange it & then they would cancell it. I have been with Nationwide since no problems.

interesting article....can't help feeling a couple of points have been over looked?? I work in the industry and just want to add a couple of points. firstly banking in the UK is still FREE one of the only service sectors that still is, yet people demand the banks are fully staffed 9-5 and that they run your accounts correctly for you the customer. Secondly, its not the banks responsibilty to run your bank account for YOU. you are in control of your own spending and you should expect to be charged if you manage them inappropriately. the charges are designed to make you stop going overdrawn not as a money making scheme. and i know banks make billions (unfortunately not much of that comes from us! typically 1/5 which includes all sectors business banking,commercial banking,personal, mortgages,lending savings etc.) i feel the point barclays are trying to make is to honest and upfront with the charges tradionally something that the industry hasn't been happening. Remember there are millions of customers who manage their accounts correctly and don't get charged.
I do however agree with pressure groups and media spotlight to make the banks think hard to providing a better fairer service which for the past 20 years has been in favour of the banks.

I take the point of a lot of what banker100 says. However, the fact is banks make an absolute fortune by hugely over inflated charges they impose. I agree a lot of the trouble people get into is down to their own irresponsibility, that said the banks feed on such people like piranhas. By all means have some sort of charging system I believe that cannot be avoided, but something much fairer & refelcting the admin costs of the banks. I would suggest that a more resaonable charge would be around £8-10 with safe guards to ensure the banks did not abuse this.

I feel that would a far better system along with a much clearer explanation to customers of the charges would be a very simple clear cut band of charges.

The best way to avoid such problems is by managing your money properly in the first place & having an agreed overdraft facility in place should you go overdrawn (let's face it we all do at some time). This way any charges levelled are a known quantity & much lower than unarranged overdrafts.

I have banked with nationwide for years & have had no real problems in charges over that time. I have an arranged overdraft that I do go into from time to time & yes I pay for that, but a darn sight less than I would otherwise.

So people the best thing is to shop around find a bank that meets your needs with such facilities as an overdraft facility & manage your money responsibly, it's that simple.

i know my brother went overdrawn and yes that was his fault but i think that alot of oeople do this around christmas. but i think that it was wrong of barclays to take the payments out so quickly and twice in a month is abit much. if they had not of done that then it wouldnt of got out control.i agree with sstudent that it should be about£8-10. £30 is to much.

I feel that I need to balance this argument. I totally agree with banker1000 and Incontrol100. I also have nothing to do with banks or finacial services. My bank account is free. I do not get charged fees. I keep the amount I need for my outgoings in my standard bank account and transfer the rest into a "savings" account. I budget, I live within my means and my bank do not make much, if any, money from me. You can all do the same. Too many people in this country live above their means and spend money that isnt theirs and the banks have the right to make money from people using theirs. Market econonics and competion should be what controlls these fees. Investors have put their money into these banks and they too have the right to see a return on their investment. What has happened to personal responsibility. If you go overdrawn and have to pay a fee ... tough...learn to budget!

My husband went £5 overdrawn on his business account with Abbey, due to someone cashing a cheque earlier than expected at the same time as Paypal took a regular payment from him. As there wasn't enough money for the Paypal bill to be paid in full, Paypal, kept attempting to take the full payment over and over again. Each time this happened, Abbey added an overdraft charge. My husband knew nothing about this until,by the next day, the fee had gone up to £160 and someone from Abbey called to notify him about it. We have a current account with Abbey and he could easily have transferred £5 from there and avoided this whole mess. If they were really concerned about him keeping enough money in his account to pay his bills wouldn't they would have contacted him before they started adding on the charges? (Paypal is also partially to blame.)

Almost everytime I read of someone incurring charges it's always been the fault of the account holder, which the willingly admit. I understand anyone can make a mistake and banks generally remove the charge for a first offence. A lot people are repeat offenders. Why blame the banks for poor account management? They need some sort of charge structure to prevent abuse. If you spend money which doesn't belong to you what do you expect? Banks haven't the resources to contact people who go overdrawn or is this a service you would willingly like to pay for. I don't know of many other service industries that provide their services for free.

Most people can have a bank account,just like a lot of people can drive a car however there will always be people who will crash their car. Learning to live within your means can be a costly lesson, and I have sympathy for people who are struggling, however currently the only option is to learn to manage your account or pay the price.

I believe no matter what charge policy a bank comes up with, there will always be complaints, hence the reason I suggest better account management.

Why don't we wait and let the courts or OFT decide.

The banks are blatantly profiteering from their customers, they could revert to the days of old when they would simply not pay any requests for payment if there was insufficient money in the account, they would notify you that the payment was not made and ask you to make funds available, to notify you costs very little, just a standard letter and you did not get repeatedly charged fees and interest, the reason that banks stopped this practice was so that they could make moe profit by misleading customers into thinking having an overdraft and excess overdrawn charges was somehow providing a service.

It seems there is quite a lot you don't understand. Read the input from pigbinjosh who has hit it squarely on the head. Why do you think banks deduct for DDs, etc BEFORE they have their customers deposits credited, particularly when they know that these deposits are just about certain - and sitting there in the bank's 'inbox' over the weekend. And that money is not gaining any interest for the customer but you bet the banks are earning on it. Get real.

Neil - Don't you think that anyone who has their income paid directly into a Bank that there is no excuse for the Bank then to turn around and debit their accounts BEFORE their salaries have been credited especially if the salary has been sitting idle over a weekend which is something I find curious in this day of computerization. As has been suggested, why is the salary not credited firsrt and then DDs, etc. paid out. If that same customer has a savings account with the same bank the bank should automatically transfer funds to meet any deficits before penalizing the customer with charges. Or, would that be too simple?

"At times when there is a bank holiday at the begining of a month, this can mean that my wages are delayed" - you should read your contract of employment - it's extremely unlikely that your employer wrote into it a paying you whenever they feel like it clause, and much more likely that they have guaranteed you either a pay date (by which the funds have to be cleared) or to pay you before the end of the month (which means that they have to pay you early if there is either a weekend or a bank holiday - I was paid on Friday 30th, as were most people in full time employment) - if they are not paying you correctly you need to either file a formal written grievance or find another job - not blame your bank.

I have been in UK for 3 years now and I firmly believe that banks in this country are “ripping off” the general public, relying on the stupidity of the masses for their revenue. As soon as I had accumulated some money in my current account, I was enticed into opening savings accounts that offer a higher rate of interest. This seemed great until I took a 2 week holiday. I have a direct debit on my current account for credit card to be paid in full, but because my credit card was nearing its limit, I decided to transfer (pay) £2000 into my card before my holiday started. This was about a week before the direct debit was due. The end result was that the full card balance as at the month end date was still removed from my account and paid into the card causing my account to become overdrawn. After this, for each and every direct debit against my account, I was charged £25; one of these for a £5.99 direct debit. I was charged £150 that month. They have system in place to identify when you have not made a payment and automatically charge you a penalty, but no systems in place to identify when you have paid some or the entire due amount. All this while I had £12000 in my savings account and over £6000 in my mini-ISA. The bank can and does earn a fortune trading with our saving money while giving us a meagre 4%. Revenue should be earned off the trading with the savings of their wealth clients rather than with the unfair penalty payment from the stupidity/mistakes of their general clients.

I want a bank account that will reject any DD that would make my account become overdrawn; at no charge. The direct debit issuer can contact me to rectify the matter. I want a bank account that will transfer funds from my savings accounts, if available, to cover any direct debits; at no charge.

The bank in question is HSBC. I have been meaning to move my accounts for 8 months now, but all the banks have the same illegal (unfair) policies. But then again… I’m one of the stupid people that the banks prey upon. They are laughing at us and really don’t care if we move. There are millions of new stupid people that can be conned into using there services. Some wise up and leave… the rest (majority) are too lazy (stupid) to do anything.

Operabunny you seem to be missing my point. I am disabled. I don't want to work it out. I've got more important things to do with my time than work out what I'm gonna spend and when I'm gonna spend it. Which never happens in reality anyway due to other factors like your shopping bill. You can't say what it's gonna be till you've got it. Or the emergency when you have to replace a couple of tyres. Decisions decisions do you pay a bill or do you get your tyres. I don't want to worry about a thing.

This is where the Think Banking comes in they worry for me, why, because i pay em to. And I can't go overdrawn because they don't issue cheque books, there's no need for them. Everything can be done by Debit card. I can still get my tyres in an emergency because i can transfer money from Bills to card and still not have to worry about bills.

It seems to me that a lot of the comments here are from people who refuse to take responsibility for their own finances and are just looking for someone else to push the blame to.

Stop complaining and do something about it!

If you know that bank holiday etc cause a problem with your mortgage payments - have you considered contacting your mortgage company to change the date (by 1 day) that your mortgage is collected?

Instead of thinking it's acceptable to go overdrawn at Christmas - because everyone does it try budgeting in the year. If you normally spend £20 a person for 10 people try buying a present a month - taking advantage of the sales. You are less likely to notice £20 a month being spent in this way than £200 in December.

At the end of the day it is important to remember that a bank is a business. A business will run at a profit. Just like clothes shops, shoe shops, mobile phone companies ...

Nobody gets anything for free.

Don't forget even in the truely 'free' service industry a library will charge you for the late return of a book!

Why expect a bank to be any different?

I find this all very strange.

I have had problems with banks before now (I mean you HSBC, Woolwich and even Abbey) but I have never been charged - am I very lucky or am I just careful?

Answer I'm not silly. Yes I go overdrawn on occassions when things don't go to plan but I have an overdraft facility on all my accounts which covers any small mistakes or unplanned extra's.

Currently my husband and I are with Abbey and have a personal account each and then a 'Bill' account which all our dd's go out off so we pay money into each month on pay day to cover the outgoings, this way we known exactly what we have left over as soon as we get paid. It was Abbey themselves who suggested this set up and insisted we had a suffcient overdrafts to cover ourselves in case something happened. I have to admit this has worked out very well and even when I was off work ill for a month on SS Pay we still were able to pay everything without incurring charges. Yes we still paid interest on the money overdrawn but it was considerably less that £25 per item!

When I was a student (and even now) I was amazed how many of my fellows believed the overdraft was just more money they could use without thinking about it. I myself worked part time and wouldn't have dreamed of asking my parents for handouts or using my overdraft any more then I abosultely had too, but all the others just seemed to think this was normal. - surely we should be teaching money management in schools as part of maths? Otherwise we are heading for real problems in a couple of generations time

So I agree people need to learn to manage their money - yes there will always be the odd problem but with careful planning - eg have an overdraft for emergencies only and not a night out on the town - you can still cover yourself and avoid high costs.

One last thing - to pigbinjosh you can change when your dd's go out you know. Once you have paid you first payment you can contact them to request changing the payment date. I have done this a number of times so that all my payments go out around the same time without any problems.

If they charged you once, or at least a lot less often, it wouldn't be so bad. It's the snowballing that's getting people in trouble.

There seem to be two people concerned in this arguement - the careful people that never go overdrawn and are now angered that the banks are having to make up for lost profit, and "the utterly stupid people regularly going overdrawn."

I fall in to the first category (of being careful, not angered). I know someone that fits in the third category. That is the "Not under my control, and now I have the financial means, it's gone up so high I still can't pay it." category.

You're a student and part time worker. You got a charge just before you lost your job because you're getting shuffled between one parent and the other and the move is to far away to commute to work.

So you can't pay that charge.

Rather than saying "Hmm, looks like they can't pay it, lets arrange something with the customer, such as a loan or stopping some direct debits Which would surely be a more responsible course of action than charging you over and over again when they can see you're not affording it.

The don't. You have difficulty finding a job because you're moving again in 4 months and no-one wants to hear it. Nor can you take them to the court (before the waiver was in) because you don't have that £80 to your disposal, and neither does your family.

You finally do get some income (this happens to be your student loan, 4 months later). Unfortuneatly by this time the amount of charges have gone up, and over the initial £50 or so, there's an additional £500. Add that to your rent deposit and travel costs, and you don't have enough to stay where you're living until you've got a job.

Unfortuneatley you have difficulty getting a job until 6 months later. At this point, you now 'owe' the bank £800, after a nice letter saying "We will be charging you £20 a day up to 10 times a month"

Now, as a student now with a part time job (so lets say, 18 hours) £300-a-month rent and other debts you got into when you were 16 and now thoroughly regret, you're working at a loss. Nevermind having to pay £200 a month just to keep your overdraft at evens with what it was last month.

(Me and him have actually drawn up a budget sheet - with the job, he's 75p in the positive each week before the credit card debt, which we're currently negotiating with the AIC.)

Having had the previous difficulty with jobs, your credit rating's not too high either, and a 0% credit card is out of the question.

It's actually not possible. You've told the bank this, and they've just shrugged, then given you the "we have a waiver, can't help you." rather than allow you to freeze it and set up some sort of payment plan within your budget.

Scenarios like this might not happen often, but the fact is, they happen, and the way things stand now the banks make no exception whatsoever for them.

I, personally, don't mind if my interest isn't what it could be, because I know that then at least the minority won't be getting utterly screwed because we thought "Well, they deserved it."

And for those who say "He should have sorted out his money before uni" - every full time job he's had the money has been sucked out of him to pay towards the debt other family members have gotten themselves into, so no luck there unfortuneatley. Additionally, why should he be denied education, when he made a £50 mistake once - the original loss of job not being his fault in the first place. If he could have acted faster to stop the £50, it doesn't really deserve £800 on top.

In response to the earlier post

Are we assuming that if anyone goes into an unauthorised overdraft it must be purely down to their own mismanagement? I am someone who never needed an overdraft because I always have - at least for the past 6 years - been in credit. Until three direct debits were removed from my account - 2 before the date I agreed to and 1 from an account I cancelled 6 months before.

This is the crux, I think. Computers and the writer of the quoted post are unable to tell the difference between a company's mistake and a customer's nonchalant attitude to being overdrawn.

There's a language factor I find particularly annoying. "Additional borrowing" when in fact 2 of my DDs were not NEW borrowing but council tax and rent - decades old.

In the days when the local branch had a relationship with an individual, they were able to decide if the customer would somehow benefit from the penalty/smack on the wrist and smarten up their act. When banks went digital they discovered they could make an awful lot of money removing the personal touch.

I know what you are saying but I do the same in my bank acccount and it does not cost me £12.50 I simply opened 2 current accounts with Smile. My salary goes into one then I transfer one amount into the other for direct debits and bills. Anything left in the first account is mine to spend. nothing in the second can be touched as it is for direct debits bill payments et remember that £12.50 a month is actually £150 a year which is quite a lot of money. Oh and smile pay good interst on current accounts

I have read most of the comments on this thread and just want to make a few pointers. Like banker1000 I too work in the industry but say these from a personal Banking experience.

- About the accounts. Most people only go overdrawn in a set period of a month (usually just before wages or benefits go into their accounts) this would make the 'personal reserve' perfect as the one charge of £22 for 5 days usage until the funds go in is FAR better than the £90+ that currently is still charged by other banks.

- Most other countries charge for current accounts (they don't offer free accounts full stop). The banks safeguard your money for free (provided you keep your account in order) they also cover you for fraud and provide you with safer ways to pay other people money. You can keep all your funds at home if you like (with the risk of being burgled and loosing everything money wise. Or you can move country and be forced to have an account you pay for.

- A lot of people have complained about the DDR's being taken out before the money goes in. This has been viewed and will be rectified with the new Faster Payments service. If the funds aren't available when DDR's, Standing orders or other payments are due to go out the system automatically will keep checking until later on (up until about 1.45pm) before it rejects the payment. It also means that you can transfer money between banks same day (up to set limits).

- It doesn't matter which bank you go to. There are always people who are going to complain about their charges. Mainly because they are angry with themselves for not keeping track of their own accounts, which in this day and age is so easy to do. Most banks offer (also for free) Online banking, Telephone banking and some even allow you to get your balance on your mobile) so there really is no excuse.

- While on the charges subject, Barclay's gives its customers time to rectify the problem before charging, up until switch of business (typically 3.30 for smaller branches and 4pm for larger ones). Unfortunately this does not seem to be the case for Abbey.

It was failed to mention that some of the new Barclay's current accounts have a credit interest rate of 3%.

- If a payment is taken early then that is the fault of the company taking the payment so they should cover any charges as it is their mistake.

Lastly (and I could go on but I wont) - As already stated, Most banks refund the first charge. So if it was a genuine one off mistake then there should be no quibbles. Also if it is found not to be the customer at fault then a charge is usually refunded.

As of yet I have not been charged. I keep an eye on my accounts. I keep a credit balance and I have a small overdraft set up in case something unexpected was to go out. When get paid all the money goes into my instant access savings account (the interest is calculated daily so I gain on that) and as the month goes on I transfer it back as and when needed. I have a higher rate savings which earns me even more on the money I don't use. I was always brought up to work within my limits and not spend what I cant afford.

Maybe the question we should be asking is 'are we teaching people from an early age to be responsible with money? Should there be lessons in schools covering money management? Is it the banks fault for this?'