Banks win Supreme Court case on overdraft charges

kylew · 25 Nov 2009 at 11:34

DreadNiK said:
surely if all these charges are so unfairly high, so that the banks could actually charge less but are just being greedy, and they cause such a problem to customers, why don't some of the banks reduce the charges and get loads more customers

actually I just got an email from natwest this morning and it looks like they are reducing their charges a bit.

According to some in this thread, Barclays charge £8 for both failed DD and unauthorised overdraft.

This is much better, but I still think a the failed DD charge is over the top, there's no need for them.

As I've said, it's like a shop fining you if your card gets declined at the till.

antijoke · 25 Nov 2009 at 11:35

Do you actually buy the fact that it costs British Gas et al money to accept cash payments?

growse · 25 Nov 2009 at 11:35

anticonscience said:
Except failed DD's don't go through (in my experience) if you do not have the cash in your bank, they get returned, and you then get a charge from the bank for this and then a charge from the company taking the payment.

This is based on years of experience working in a CPW store and people coming in moaning about bank charges/CPW charges demanding we do something about it. :/

In which case I agree - the system should be changed so that the DD gets honored by the bank who then charge you for an unarranged overdraft.

kylew said:
That's not the case, I've had my bank try to con me in to believing this to be true, but on closer inspection it was a lie and when I asked them why they were lying about it, they promptly refunded me.

They claimed to have paid a DD which took me into an unarranged overdraft, but if they had, I would have had the amount of the DD also added to the fine.

I don't think it's a conspiracy, merely that they increase the fee to make people set up DDs instead.

There's no conspiracy there, you even said it yourself, they're easier for the companies.

See above.

anticonscience said:
Do you actually buy the fact that it costs British Gas et al money to accept cash payments?

Cash and cheque? Yes. Say you take cash to the post office. The PO don't provide that service to British Gas out of the kindness of their hearts, British Gas pay for that. DDs cost as well, but they're cheaper and easier for the supplier to manage.

*edit* randomly taken from http://www.eazipay.co.uk/ - that company is quoting 40p per DD to receive. I imagine the big suppliers get a significant discount, so I can certainly see the where the extra cost in processing cash and cheque payments comes from.

gambitt · 25 Nov 2009 at 11:36

Those of you who are saying they are happy with this would you mind answering these questions:

1. Banking is a service. Why should you expect it to be free?

2. To the "play by the rules and you won't get charged crowd": What happens when you have say £100 in your account, spend £50 on Tesco online and a Direct Debit for £20 is coming out of your account the following day. Tesco accidently charge your card twice (yes this can and has happened) and it takes £100 out of your account. They can't put it back straight away as it takes a couple of days to clear. DD comes out the next day leaving you with a £35 charge and £25 overdraft fee. So this person has played by the rules. Now what?

3. What would happen in theory if everyone managed their money perfectly so banks didn't make any money from charges. Would you lot be complaining about having to pay for banking then as well?

kylew · 25 Nov 2009 at 11:38

gambitt said:
Those of you who are saying they are happy with this would you mind answering these questions:

1. Banking is a service. Why should you expect it to be free?

2. To the "play by the rules and you won't get charged crowd": What happens when you have say £100 in your account, spend £50 on Tesco online and a Direct Debit for £20 is coming out of your account the following day. Tesco accidently charge your card twice (yes this can and has happened) and it takes £100 out of your account. They can't put it back straight away as it takes a couple of days to clear. DD comes out the next day leaving you with a £35 charge and £25 overdraft fee. So this person has played by the rules. Now what?

3. What would happen in theory if everyone managed their money perfectly so banks didn't make any money from charges. Would you lot be complaining about having to pay for banking then as well?

Your post will have a huge "CENSORED" stamp over it to some people posting in this thread.

Sawell · 25 Nov 2009 at 11:39

Pah, goodbye £4,000 in fines

Moley · 25 Nov 2009 at 11:40

This whole issue is far from over as the the ruling left scope for the OFT to pursue the matter in other ways.

As a side note, the estate agent I used to let my flat from wanted to switch from being paid by standing order to being paid by DD and I told them to sod right off. DDs give outsiders the right to take money from your account, whereas SOs are you making the payments to them. On the surface it all appears to work in the same manner, the main difference being just who has control of the transaction.

Vidar · 25 Nov 2009 at 11:41

I find some peoples attitudes on here disgusting, yes there are pleanty of free loading scum but then what about the likes of me, I had a good job and kept well on top of my income and expenditure....

Then I got seriously ill and have been unemployed since.... Did everything one could to keep charges at a minimum but when your trying to live off next to nothing and owe a few thousand pound it doesnt matter how good a customer you where they **** you! They **** you for everything they can get from you...

I hope for your sakes you never have a change in circumstances as drastic as I did, but maybe it would be humbling for you

I for one cant fathom the Supreme Courts ruling, it's a complete farce!

matthewhotdude · 25 Nov 2009 at 11:41

well it's harldy hard to maintain a bank account, so you don't get charged in the first place

zootfloot · 25 Nov 2009 at 11:42

Sawell said:
Pah, goodbye £4,000 in fines

I think a lot of people will share this feeling buddy.

antijoke · 25 Nov 2009 at 11:43

NW_SKINHEAD said:
I find some peoples attitudes on here disgusting, yes there are pleanty of free loading scum but then what about the likes of me, I had a good job and kept well on top of my income and expenditure....

Then I got seriously ill and have been unemployed since.... Did everything one could to keep charges at a minimum but when your trying to live off next to nothing and owe a few thousand pound it doesnt matter how good a customer you where they **** you! They **** you for everything they can get from you...

I hope for your sakes you never have a change in circumstances as drastic as I did, but maybe it would be humbling for you

I for one cant fathom the Supreme Courts ruling, it's a complete farce!

Then just to play devils advocate could you not have had payment protection on the money you owed to cover such circumstances?

zootfloot · 25 Nov 2009 at 11:43

NW_SKINHEAD said:
I find some peoples attitudes on here disgusting, yes there are pleanty of free loading scum but then what about the likes of me, I had a good job and kept well on top of my income and expenditure....

Then I got seriously ill and have been unemployed since.... Did everything one could to keep charges at a minimum but when your trying to live off next to nothing and owe a few thousand pound it doesnt matter how good a customer you where they **** you! They **** you for everything they can get from you...

I hope for your sakes you never have a change in circumstances as drastic as I did, but maybe it would be humbling for you

I for one cant fathom the Supreme Courts ruling, it's a complete farce!

Agreed mate, a few internet warriors in this thread who have never lived on the other side i feel.

zootfloot · 25 Nov 2009 at 11:45

anticonscience said:
Then just to play devils advocate could you not have had payment protection on the money you owed to cover such circumstances?

Payment protection can sometimes take a fair while to kick in, and when it eventually does it doesnt last forever, by the time it has kicked in it could already be too late.

Vidar · 25 Nov 2009 at 11:47

anticonscience said:
Then just to play devils advocate could you not have had payment protection on the money you owed to cover such circumstances?

I could and actually did but PPI insurance isnt all its cracked up to be, they found a loophole to get out of paying as they often will! My now condition was related to something from childhood not the same condition but thats what they classed it as.....

PPI like everything else isnt there to help you, only take your cash! You'd be better protected with a tin foil hat in a thunderstorm

growse · 25 Nov 2009 at 11:47

gambitt said:
Those of you who are saying they are happy with this would you mind answering these questions:

1. Banking is a service. Why should you expect it to be free?

Why shouldn't it be? I already pay the bank money in different ways. Is there a rule that says every service must have a directly relatable cost next to it? If so, how much do I pay for the service of my local park?

2. To the "play by the rules and you won't get charged crowd": What happens when you have say £100 in your account, spend £50 on Tesco online and a Direct Debit for £20 is coming out of your account the following day. Tesco accidently charge your card twice (yes this can and has happened) and it takes £100 out of your account. They can't put it back straight away as it takes a couple of days to clear. DD comes out the next day leaving you with a £35 charge and £25 overdraft fee. So this person has played by the rules. Now what?

You talk to the bank?

3. What would happen in theory if everyone managed their money perfectly so banks didn't make any money from charges. Would you lot be complaining about having to pay for banking then as well?

I'm not sure if hypotheticals are helpful here. What if everyone kept cash under their mattress and the banking system fell over, would we all be happy then?

Wicksta · 25 Nov 2009 at 11:48

zootfloot said:
Agreed mate, a few internet warriors in this thread who have never lived on the other side i feel.

How has anyone been an internet warrior in this thread? Apart from one person calling someone else an 'idiot' it's been pretty civilised. I think you'll find many people have lived on the other side, including myself.

Moley · 25 Nov 2009 at 11:49

anticonscience said:
Then just to play devils advocate could you not have had payment protection on the money you owed to cover such circumstances?

Is this the payment protection insurance which has been so badly mis-sold by banks in the recent past that they have been hit with huge fines by the FSA and are now having to repay all the people they mis-sold to?

Banks doing the wrong thing and being forced to pay back customers...... that sounds strangely familiar....

growse · 25 Nov 2009 at 11:50

NW_SKINHEAD said:
I could and actually did but PPI insurance isnt all its cracked up to be, they found a loophole to get out of paying as they often will! My now condition was related to something from childhood not the same condition but thats what they classed it as.....

PPI like everything else isnt there to help you, only take your cash! You'd be better protected with a tin foil hat in a thunderstorm

Whilst your situation is obviously extremely unfortunate, doesn't it point more to a failing in the PPI industry, rather than anything to do with banking charges? Is it not the case that if the PPI covered you properly, then you wouldn't have any issues?

Insurance sucks though. I hate it

Moley said:
Is this the payment protection insurance which has been so badly mis-sold by banks in the recent past that they have been hit with huge fines by the FSA and are now having to repay all the people they mis-sold to?

Banks doing the wrong thing and being forced to pay back customers...... that sounds strangely familiar....

Agreed, this was a huge huge problem before and in my view the FSA needed to do more.

drizzy · 25 Nov 2009 at 11:51

People who can't manage their money being charged while I pay nothing and can use almost any ATM for free > $4AU/month for an account + $2 for every non-commonwealth bank ATM withdrawal.

Purely selfish but I'm happy with this decision. It's not like the charges are hidden.

zootfloot · 25 Nov 2009 at 11:52

Wicksta said:
How has anyone been an internet warrior in this thread? Apart from one person calling someone else an 'idiot' it's been pretty civilised. I think you'll find many people have lived on the other side, including myself.

Ah, apologies.

That wasnt directed at anyone in particular and yes it has been civilised so far, it was more a general gripe with some comments from earlier in the thread.