News The Banks win - you lose :p

[mooSe_]

Happened to me once because I thought I had more money in there than I actually did. Nothing to do with 'wanting to take money I don't have', I would rather it just told me that I have no money and that I can't buy anything than letting me take it out and then charging me extra a week later when I finally realise.

 

[old.Tohtori]

My card works as so;

If not money on account, can't buy stuff. Ever. Not even 1p worth over the limit.

Can suggest to anyone

 

[MYstIC G]

Whats the difference with taking an extra tenner you dont have with the bank

I don't know about you but I've never written to my bank instructing them to allow my account to go into the red and charge me fees that they see fit accordingly. Years ago Orange incorrectly processed a Direct Debit that was greater than my entire months salary. If my bank had stuck to the "not enough available = reject" I wouldn't have spent over a week sorting it out. Similar story when my card was cloned by a scumbag till clerk at a BP petrol station, instead of "not enough available = reject" the fraudsters managed to wipe through my account balance and an additional £500/£600 which I then once again had to argue to sort out.

Banks charging for shit is fine. However I'd love for someone to show me how you absolutely guarantee that your bank will never allow transactions to go out of your account? It's all very well there being something available but they always hide the ability to tell them "fuck off I don't want that"

It's almost as bad as it used to be trying to unsubscribe from xbox live, essentially the only guaranteed way was to let your card expire.

 

[Marc]

Good job I did my claim 3 years ago and got paid out within weeks of entering it!!!!

 

[pez]

Even if they stopped at 0 they would still charge you for bouncing cheques/standing orders/direct debits.

Kind of makes me laugh, half the population are like 'bank charges, who gives a fuck?' and the other half foam at the mouths.

Wonder if you can guess which half don't spend money they don't have.

Besides, if they stopped charging morons for going beyond their limit then we would all have to pay account maintainence fees like in lots of countries.

 

[MYstIC G]

Except in my case, where I could have refused to pay the invoices because the errors were not mine. It seems to me that it would also help to combat fraud.

 

[nath]

Wonder if you can guess which half don't spend money they don't have.

Bullshit argument - I've never gone overdrawn, I've never been charged for going over and I think the charges need more regulation. Of course people who have been charged are going to be pissed off, that doesn't invalidate their position.

 

[Vae]

I've never been charged bank charges, in fact I manage my money extremely closely but that comes with my profession.

In my opinion the banks are deliberately targeting those in society most in need of helping to manage their money. The same goes for those companies offering payday loans or doorstep loans with insane interest rates. It's all targeted at exploiting the people struggling to survive day-to-day. These are the people who maybe haven't got the knowledge to really understand what they're getting into and they're being exploited.

These people are getting trapped into a spiral of debt and never being able to get out of it and the banks/credit card companies etc are making the most out of it.
Look at the way credit card companies set the minimum payment at a level it will take you 10 or 20 years to pay off the balance. Look at the way bank charges spiral out of control once the first is incurred.

While I don't dispute that these people signed up to these conditions I do highly doubt whether they truly understand the implications. It would be far better for the banks to bounce any payments rather than put people into unarranged overdrafts at punitive rates and charges. Similarly people should have to earn credit rather than being automatically approved because the banks know their spending will get out of control and they will have another customer trapped for life.

I would far rather they introduced reasonable fees for monthly current accounts (say £5 per month) and switched to a system of far more reasonable charges and no unarranged overdrafts even though I would be a loser in that situation. People are not helped to manage their money - they're helped to get into debt so they can be exploited.

 

[Bugz]

But then Vae, why should the rest of us incur a charge for the mishaps of certain individuals?

 

[Scouse]

It always amuses me that many people are so quick to defend the banks when they're obviously profiteering wankers who've fucked us all over to the tune of several thousand pounds each...


But no. It's all our own fault eh?

 

[Vae]

But then Vae, why should the rest of us incur a charge for the mishaps of certain individuals?

Because at the moment the exploitation of these individuals is being used to offset not charging you. There is a cost to running a banking system which can't be wholely absorbed by not paying any interest on current accounts. At the moment it could be argued that the certain individuals and their mishaps are being exploited and overcharged in order to subsidise sensible people like you and me.

 

[nath]

But then Vae, why should the rest of us incur a charge for the mishaps of certain individuals?

Why should people who are not so good at managing money subsidise our accounts?

 

[Bugz]

Because at the moment the exploitation of these individuals is being used to offset not charging you. There is a cost to running a banking system which can't be wholely absorbed by not paying any interest on current accounts. At the moment it could be argued that the certain individuals and their mishaps are being exploited and overcharged in order to subsidise sensible people like you and me.

My brain is frazzled from doing economics for a couple of hours. Let me get back to you with a proper argument on this.

 

[pez]

Pretty sure I already pay tax to susidise the less fortunate.

 

[Mey]

They can't just reject payments because if you use your Debit Card to buy something in a shop the money isn't debted instantly and therefore if they reject the payment after you have recieved the goods the company that you recieved the goods from would lose out.

 

[MYstIC G]

They can, that just requires them to invest in the technology. This method also absolves them of any responsibility. This is why money works. If you walk into a shop with £40 and try to buy something worth £400, see how far you get.

 

[Jeros]

Oh well, if a bank pisses you off just threaten to take it through the local paper with a sob story, from what im told, they will make a phone call, then do whatever you ask

 

[Jupitus]

Because at the moment the exploitation of these individuals is being used to offset not charging you. There is a cost to running a banking system which can't be wholely absorbed by not paying any interest on current accounts. At the moment it could be argued that the certain individuals and their mishaps are being exploited and overcharged in order to subsidise sensible people like you and me.

How about the gazillions of cash*** they make using the credit in our accounts to play money markets with?


















*** Don't expect me to provide any sunstantive evidence for ANY of my arguments on here... just like real life, Vae

 

[pez]

I think banks have to be able to cover like 90 or even 100% of all cash in current account at any one time.

 

[yaruar]

I think banks have to be able to cover like 90 or even 100% of all cash in current account at any one time.

Nope, not in any way shape or form. Banks don't have to cover the deposits at all in the uk
Reserve requirement - Wikipedia, the free encyclopedia

 

[old.user4556]

Yep, that's why we're in the fucking situation we're in with the banks.

 

[pez]

I stand corrected. I knew they could spend all the money they liked in savings accounts but I thought they had to cover current accounts.

 

[Yoni]

I love the dutch banking system. You get charged a % interest on any overdraft which is not prearranged. It is not so punitive that it will leave people stranded either.

The bank I am with do not charged for direct debits which need to be taken a second time either.

It is one of the many awesome things about life over here.....

 

[Bugz]

I stand corrected. I knew they could spend all the money they liked in savings accounts but I thought they had to cover current accounts.

Not at all.

The banking system works solely on the principles of confidence and the need not to hold all your cash on you at once.

Northern Rock went under (partially) because confidence in them dropped, everyone tried to extract their deposits and the firm did not have enough liquidity to support this.

 

[Raven]

Not at all.

The banking system works solely on the principles of confidence and the need not to hold all your cash on you at once.

Northern Rock went under (partially) because confidence in them dropped, everyone tried to extract their deposits and the firm did not have enough liquidity to support this.

er no, they went under because they gambled to high in the debt market. Not one person couldn't withdraw their money.

 

[Tom]

Loving reading the comments from people who think that bank charges wholly subsidise their 'free' banking.

Have they ever looked at the typical interest rate on a current account, and what the bank earns on that money?

 

[old.user4556]

If you're smart with your cash, you don't leave any more than you have to in your current account.

Imo:

Salary paid into current account -> cover monthly outgoings -> move the rest to your investment of choice (combo of direct access savings, ISA, mortgage overpayment, AVCs or share portfolio, perhaps) -> pay for regular stuff (food, fuel etc.) on a cashback credit card, or a points reward credit card such as a Tesco Clubcard credit card and pay that off once a month.

 

[Bugz]

er no, they went under because they gambled to high in the debt market. Not one person couldn't withdraw their money.

If you note very closely Raven, you can see the brackets with the word partially inside.

If you also put two and two together, you'd realise I was simply posting a reply to the question and not detailing the full history of why northern rock went under.

Edit - I could have used the 20th century stock market & banking crash but I felt the current credit crunch was a more realistic place to draw examples people could relate to.

 

[Mey]

Either way, you all best start having confidence in Lloyds TSB again, I need my shares to go back to being £6 for when I graduate. Thanks!

 

[Raven]

The only problem with that is, Lloyds are a joke.