Originally Posted by
ScottGem
And this sticks in my craw a bit. As a free market capitalist, I'm not much in favor of protecting people from themselves. If the charges are the result of their mistakes and mismanagement, then why not charge them for it? Maybe there needs to be more education so people do a better job of managing their money. And maybe part of these fees can go towards that.
I understand where you are coming from here Scott and I'm not saying that the banks shouldn't charge a fee for these types of transgressions.
The whole point, in LAW, is that this fee must be representative of the time and losses incurred by the bank.
While a transactional system of banking would make a great deal more sense, at present we have a "free in credit" system.
Another of the major issues is the continual charges applied to accounts after the error occurred.
All charge a daily fee if your account is over your agreed over draft.
So not only is there a charge for the original error, but more charges every day until the balance is below the agreed limit.
This can soon snow ball into serious trouble.
For example, my own bank charges £20 for the original error, and then, up to 10 daily fees of £10-£20 (depending on balance over limit) until the error is rectified.
So, again for example, if I exceeded my limit by £50 for 2 weeks, I would be charged the original £20 plus 10x £20 totalling
£220 for a £50 transgression, as well as 30% APR on the error.
Now is this model "fair" to the consumer?
Now that's a simple example, but if you start adding other bounced payments, then you can start to see the knock on effect, as well as continuing into following months.
The Banks are also bound by a Code of practice that is meant to go some way to protecting the consumer and being able of offer assistance to those in real financial hardship. This code is regularly ignored and breached causing even more issues.
Our Banks have stopped being the bastions of financial sense and have moved more and more into being simply "shops" for financial products.
Gone are the days of, even, passable customer service.
As ever they are increasingly driven by sales targets and goals.
What used to be a well thought of profession is now becoming somewhat of a joke.
The Bank Manager used to have the final say on ANYTHING that occurred in his branch, now they are simply "sales mangers" driving their "teams" in an attempt to squeeze as much out of the consumer as possible.
Yes, I know you're going to say change banks if you don't like it, but this is endemic across the whole banking industry and it needs a sea change of this nature to force change from the consumers.
Well I rambled a bit, but I hope it makes some sense and you can start to understand the issues in the case.