UK banks are hanging on to the bitter end over the issue of unfair overdraft charges.
The basis of the consumer driven court action against them is that you cannot enforce a contractual agreement if the terms are unfair. The banks have an appeal in train and the judicial system has allegedly postponed a decision because the judge is engaged on another case – or perhaps the current economic situation was forseen long before it became public.
This afternoon I have had an extremely acrimonious argument with the manager of Halifax, West Street, Havant regarding such charges.
Bear in mind that HBOS may shortly be taken over by Lloyds TSB. I haven’t been and asked Lloyds whether their charging policy is any different, maybe I should.
The first excessive charge was made on a day when I wasn’t actually overdrawn at all, according to the statement I received. I should say, straight away that I manage my account online and the statement and the notifications that charges would be applied were automatically notified by email. No human intervention or action whatever - £35 per ITEM, not £35 for each day over the limit.
The not-particularly-pleasant manager, with whom I have had charges disputes before was adamant that I should have moved the money the day BEFORE the direct debit was due to come out. Surely what should matter is the balance at the END of the day!
I recall the day that happened too., My credit card statement said that my monthly payment would be taken on 1st November, so I went in on 31st to ensure that funds were available. At that time, the monthly direct debit was not showing on my customer screen. Yet, when the manager showed me the bank view, not only was the DD showing before the credit, there was another charge from later in the day that also showed up before the credit – eh???
Even if you take the bank view of the sequence of events, I would have been less than £3 over the limit for less than 12 hours. The manager was unable to explain why the statement I was waving angrily at her showed a completely different story and could only repeat, tight-lipped that the DD was processed first and so the bank were entitled to make the charge.
The second incident was not just one but FIVE separate charges for transactions made when my account was over the limit. Now I hold up my hands and say I forgot to cover a payment made over the phone to my energy company on a Friday evening. The banks can manage to generate charges and log transactions over a weekend, but still claim that these are not working days for the purposes of crediting one’s account.
Yes I DID go over my limit and ONE charge might have been justified, but not £175 worth of charges for going over my limit by a far lower amount. One of those £35 charges was for a transaction for just £5 - all this notified by email.
I should also mention that I have thousands of pounds in savings accounts with the Halifax – surely some kind of security. Other banks have a flexible account that would take such credit into consideration.
If the banks’ appeal succeeds it will make a mockery of the law that says you can’t enforce an unfair contract.
Meanwhile, from conversations with friends, it would appear that HBOS are one of the worst offenders when it comes to unfair overdraft charges. If you were considering moving your account there, or doing any other kind of business with them, I would suggest you think again.
Possibly it is their bad reputation in this respect that is responsible for their current precarious position. A bank that was not so greedy and unreasonable might be more successful at keeping their customers.