bank to imposes £10 monthly charge

But it will feel like a tax because there is no way around it. Unless you close your account and hide all your money under your mattress
 
Samtheman1k said:
That's the point. They probably aren't getting anything from you either as it is your secondary account. It is their polite way of saying that you aren't actually a valued customer and they don't particularly want you as they don't make money off you.
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theres almost the £1500 going in each month tho :(
 
So if you don't A) pay in £1,500 a month or B) have an average monthly balance over £1,500, you'll get charged £10. And this is 'aimed at dormant or rarely used accounts.'

But if you open a savings account or a credit card with FD you'll be exempt from the charge. Great - open a savings account, pay in the minimum amount and don't use it. That way FD have got even more 'dormant or rarely used accounts' to deal with.
 
guardian unlimited said:
The move by the bank - a part of HSBC and a pioneer of telephone banking since its formation in 1989 - will affect 200,000 of the bank's 1.3 million customers.

To avoid the fee customers will have to pay in £1,500 a month - requiring an annual salary of at least £24,000 before tax - or maintain an average balance of £1,500.

First Direct's chief executive, Chris Pilling, said: "If you do [want to stay], either please put more money into a relationship with First Direct, or buy a product from us, or pay the fee."

Products that will result in the fee being waived include the bank's credit card or mortgage products.

Mr Pilling said the move was aimed at the bank's 40,000 dormant accounts and at those who use the bank for five to 10 transactions a year. "Eventually that's a cost to us," he said, adding: "These changes are designed to encourage people to deepen their relationship with First Direct. I want to focus our efforts on our most important customers: those who use us as their main bank or have a number of products with us."
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That's bullcrap. There are plenty of First Direct customers who use them as the main bank but don't get paid over £24,000 per year. If they really meant that, they would not charge anyone who had a salary being paid into their account - no matter what the amount. What he should be saying is that they don't want people on lower incomes because whereas before they made a fortune hitting people who went overdrawn with charges, they now can't do that. So instead, they won't take the business. At least he would be being honest about it.
 
glitch said:
So if you don't A) pay in £1,500 a month or B) have an average monthly balance over £1,500, you'll get charged £10. And this is 'aimed at dormant or rarely used accounts.'

But if you open a savings account or a credit card with FD you'll be exempt from the charge. Great - open a savings account, pay in the minimum amount and don't use it. That way FD have got even more 'dormant or rarely used accounts' to deal with.
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ah didnt see that bit, I have a savings account setup already will that count?
 
Werewolf said:
If memory serves it's what happens in many other countries (either you pay a monthly fee, or fee based on the number/type of transactions) - we as customers cannot have it everyway, if the banks cannot cover their costs and make a profit one way (which is what they are in business for), they will do it another way.
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Thats right, certainly in Canada. You are charged if you want a cheque (or check for the Canadians ;)) book, debit card etc. They will also deduct a set amount of interest earnt.

If banks do start charging I'd like to see some improvement in support or local branch services, opening hours would be a good start.
 
Any 'product' in addition to your current account should suffice. At least that's how I read it.

Might as well sign yourself up for their e-Savings account. All you need is a £1 balance in it.
 
£100 a year would be cheap for the service you get as a rule,but can't really see it getting too far because people have come to expect it gratis,and will just switch to those that hold out a free service.

Annoys me slightly (ok a lot) that for my business account,not only do they charge interest when i use my od facility,make interest when im in credit,they also charge £100/yr for the account,60p for each deposit and 43p for each transaction.Account charges roughly equal half my interest payments,so i'm effectively paying c12% interest.
Also feels like the business account charges are just a means of subsidising the free personal accounts.
 
kitten_caboodle said:
That's bullcrap. There are plenty of First Direct customers who use them as the main bank but don't get paid over £24,000 per year. If they really meant that, they would not charge anyone who had a salary being paid into their account - no matter what the amount. What he should be saying is that they don't want people on lower incomes because whereas before they made a fortune hitting people who went overdrawn with charges, they now can't do that. So instead, they won't take the business. At least he would be being honest about it.
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I've been with First Direct for 12-13 years and got a letter from them about this today. After a load of waffle and bleating self-justification on their part, I finally got to the paragraph that mattered - where they told me that the charge wouldn't apply to my accounts.

That's good to know, but I still think the whole idea is a ******* liberty :mad: . I reckon kitten has hit the nail on the head - the line about 'dormant accounts' is a load of crap - this is just a more polite way of saying that unless you earn more than £24k a year, First Direct don't want to know.

If you think I'm wrong in thinking that, then as quoted they should have said that the charge would not apply to anybody who has their salary paid into their account - by definition their account is then not 'dormant'.
 
Adnams Drinker said:
If you think I'm wrong in thinking that, then as quoted they should have said that the charge would not apply to anybody who has their salary paid into their account - by definition their account is then not 'dormant'.
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Indeed. Maybe FD live in the same parallel universe as laissez-faire, where nobody except students earns less than £24k a year. In the real world, millions earn less than that of course.
 
kitten_caboodle said:
well we'll be moving our accounts from FD at the end of the month and we'll be telling them exactly why.
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icon14.gif
:D
 
RichieUK said:
But it will feel like a tax because there is no way around it. Unless you close your account and hide all your money under your mattress
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My point exactly, except as your employer pays your wages into a bank account you have no choice.
 
Luckily my letter said I wouldn't be affected. However, compared to the dire service I had from natwest prior to switching to FD 7 years ago, I would pay the charge to have the efficient service I've always got from FD.

I vaguely remember FD always had a policy of asking you to pay at least 1k or maintain a 1k balance to hold an account with overdraft facilities with them, although it seems they haven't ever enforced it.

I think its fair to say we can all thank all the bright people who felt the need to claim back 'unfair' bank charges only applied to their accounts because they breached the clear terms and conditions the bank advise you of when opening account. I think FD will be the first of many to start charging.
 
laissez-faire said:
I don't think it will affect many people; can't see them charging for a student account and students presumably will be about the only people with an income below £1500 per month.

If not; how about just move money between different accounts? Or go to a cashpoint and withdraw £250 then pay it in a few times a month. They will never bother checking. Getting an income of £1500 is not hard.
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The more posts of yours I read the less I believe that you live in the real world :p

You need to earn ~£24K pa to pay £1500 per month into your account.
This is around the median wage so logically 50% of full time earners will have less that this go into their account each month.
This doesn't take into account part time workers, pensioners or people who don't work at all that may have a current account.
 
BUSH said:
I vaguely remember FD always had a policy of asking you to pay at least 1k or maintain a 1k balance to hold an account with overdraft facilities with them, although it seems they haven't ever enforced it.
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Never enforced it because obviously they wanted to get as many people on the books as possible before they introduced this 'fee'.
 
It's neither a fine nor a tax. It's a fee for providing a service, simple as that. Do you consider paying your electricity bill to be a fine? No. Thought not. Note that I avoided tax there deliberately because there is a tax element to electricity bills (and I wouldn't put it past the government to slap VAT on bank fees if this takes off).

That doesn't alter whether or not it's fair - there are both fair and unfair charges (although most people probably consider all charges to be the latter). Personally, I agree with Kitten that it is a tactic to dispense with those accounts that don't have a significant (in the bank's eyes) throughput of money (including those from people who earn less than £24k pa), and not just dormant accounts. As such, it hits the poorest hardest, and I'd consider that a pretty good test of being unfair, but also, sadly, the norm.

I pay a fee for my banking and don't mind doing so, but I can see why people would dislike this and as such I hope it backfires on them. Sadly I doubt it will - I've noticed a trend in banks cutting services, removing fee waivers, and now this.
 
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