Lords Decision & Fees For Unauthorised Bank Overdrafts

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MartynK

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What does everyone think of this decision?

I haven't been back in this country for very long, and I was a bit puzzled by the whole thing.There's no free banking in South Africa at all, every transaction has a fee, including withdrawals from ATMs (very expensive if it's not your own bank). There are no "unauthorised" overdrafts either. The banks just bounce any cheque or debit/stop order if you have insufficient funds in your account, and whack you with a penalty of about £15. Getting an overdraft, or an extension on an existing one, involves submitting a written application supported by a short statement of assets and liabilities, including mortgages, bank loans, credit cards and insurance premiums.
 
Credit where Credit is due I say :D
 
I don't have a problem with being charged for an unauthorised overdraft.

I'm also from South Africa, so it is a pleasant change to have free banking.
At the end of the day it is my responsibility to ensure I do not go overdrawn on my account without a facility.

At the end of the day a bank is a business and needs to make money one way or another. I do however believe that the charges should be proportionate to the amount overdrawn. Banks that charge £35.00 for going £1 over the limit is taking the p**s. They should set the charge at a percentage of how much you went over.

I went over once by a couple of quid with a direct debit, I realised this and paid money into the account the same day that my direct debit went out, but still got charged £30.00. I complained like hell and eventually they agreed to reverse the charge.
 
I think its the wrong decision. I think that at the very least the way they charge these is ethically very dubious, and they're arguement that they support free banking is just p*** poor.

If thats what it takes for free banking then I don't want it, not on the strenght of gaining it at the expense of some of the more indebted members of society.

I have no problems being charged a fair charge for an unauthorised overdraft, but I draw the line a punative charges which force further debt and the banks over here have something of a reputation for sharp practices on the forcing debt front.
 
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I also think that it's the wrong decision - I don't disagree that they should charge, but there should be a capped amount, £10 or £15 max. £30ish is silly and some banks charge for the transaction and then again for going overdrawn so in the blink of on eye you've got an extra bill for almost £100 - which is alot of money!
 
I think that we have to think of banks as businesses, out to make money. Despite what they say in the adverts, they are not really interested in helping their customers, particularly if you dont have much money.Mine has continually offered me loans, credit cards, insurance and "gold" or "platinum" accounts. In every case they would make money out of me. When, for a short time, I had a small amount of money to invest they couldnt be more helpful, wanting to advise me where to invest it.

However a friend of mine went through a bad patch after a difficult divorce and the bank was charging him something like £30 per day for a relatively small unauthorised overdraft. They wouldnt offer him an authorised overdraft and he struggled to repay them because they kept slapping on the £30 charges.

The amount of bank charges should be regulated and they should not be allowed to offer loans and credit cards to people unless they are requested. It is too tempting for some people, especially youngsters, when they are offered credit.I remember years ago when people had to go to the bank manager and ask for loans, and be able to show, like the people in South Africa, how they would be able to repay it.We need to get back to those times.
 
does someone wanna give the short version of the decision for someone too bone idle to google for it?
 
ladysue said:
The Office of Fair Trading doesnt now have the power to investigate unauthorised overdraft fees.So basically they can charge what they like.
Click to expand...
and I bet the banks are clapping their hands and rubbing them together, knowing how many people have been hit hard by the recession.

"What's that you say Mr. Jones? You just lost your job and you're struggling because of that debt? You want an authourised overdraft so you don't incur more charges? But Mr. Jones, if we give you an authourised overdraft, we'll only be charging you £10 a month, if we don't we can change you 6 times that - and that's just for one transaction!"

:thumbsdown:
 
I work in Germany.
three or four times in the last couple of years I have worked out what is left in my account (uk) and withdrawn cash in Euros.
when the bank statement comes through it shows me going into an unauthorised overdraft (usually by 1-2 £) this is due to the banks charges for overseas withdrawals, usually around 7-9£ per transcation.

for this they then charge me £35 a time.

dead chuffed over this ruling............
 
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