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EU threatens free banking in the UK -another reason to leave the EU! Watch

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    (Original post by Scumbaggio)
    I think we have the illusion of free banking.

    quoted for truth - this is the scenario ...
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    (Original post by zippyRN)
    point missed I think, i.e. your 'free' banking is paid for by being gouged ( by a factor of 5 -10 * the cost ) for things like missed Direct Debits
    But overall it's cheaper than paying a monthly fee for the account and your overdraft !


    The point hasn't been missed- they are a business so fundamentally required to make a profit!
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    Wait. How does regulating banks increase costs for consumers? It just means that extortionate rates that already exist will be pushed closer to the BOE rates.
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    (Original post by zippyRN)
    come back when you have actually lived on your own and not had the bank of mum and dad to bail you out ...
    I have lived on my own, and I've never had any charges. Tell a lie, I have, but it was the fault of Lloyds who re-imbursed me along with some extra for "stress and loss"
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    (Original post by de_monies)
    I have lived on my own, and I've never had any charges. Tell a lie, I have, but it was the fault of Lloyds who re-imbursed me along with some extra for "stress and loss"
    Exactly!
    Banking can be 'free' when you do it right and don't spend above your means!
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    (Original post by zippyRN)
    point missed I think, i.e. your 'free' banking is paid for by being gouged ( by a factor of 5 -10 * the cost ) for things like missed Direct Debits
    So Im guessing you've missed direct debits? If you have, well tbh you're not managing your money particularly well. I can do it as a student. It's not particularly hard
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    (Original post by de_monies)
    So Im guessing you've missed direct debits? If you have, well tbh you're not managing your money particularly well. I can do it as a student. It's not particularly hard
    it can be rather hard when things like variable elements of pay are not paid or you have a true emergency and have to spend all available cash and more ...

    as i said come back when your balls have dropped , you are out of short trousers and the ink on you certificates has dried ..
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    (Original post by zippyRN)
    it can be rather hard when things like variable elements of pay are not paid or you have a true emergency and have to spend all available cash and more ...

    as i said come back when your balls have dropped , you are out of short trousers and the ink on you certificates has dried ..
    What's an "emergency situation" likely to cost then? Car expenses? If you're working, I really can't see how you could mismanage your money so badly.

    I probably earn less than what you do, yet I've never missed a DD, I have credit cards, where I never pay interest, I move money about with six banks etc... Just because you're not financially sound and just because you can't manage your money, don't expect it to be the same for everyone else

    And don't assume that I can only manage my money because of "Mummy and daddy" When truth be told, I don't need any of their money. Yes they have actually gave me money, but I've not touched a single penny of it. I save it instead. I've used student loan money, so they may as well never have given me any thing in the first place.

    There is a reason why it is recommended you have at least 3 months of "pay" available to you - for emergency situations and when pay is not paid

    That being said, I forgot to submit time sheets for April, and Ill have to put them in for May, but I have a procedure ready ie: save enough money....

    I mean I can live on 5K/year pretty easily by myself. It's not particularly hard. 6-7K/year with a car I guess
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    (Original post by zippyRN)
    come back when you have actually lived on your own and not had the bank of mum and dad to bail you out ...
    I've lived on my own since September and I've never needed a 'bail out' from my parents or anyone else. I make sure I have the money for the things I buy and that it's in the correct account before it's due to go out. It's called managing your money properly.


    (Original post by Bonoahx)
    Regularly switching bank accounts would be too much of a pain, you'd need to regularly get a new debit card too.

    And some people, like university students, have to take out unplanned overdrafts etc. to live.
    I know what switching involves as I do it myself. I personally think it's worth it, others may disagree and if they do then they can 'pay' via lower interest rates. I don't see how forcing everyone into what is essentially an option b (as they get higher interest rates but have to pay money to the bank out of this) is the better of the two.

    University students get interest free overdrafts up to quite a large amount and other people will get benefits if they really are on that low of an income. If you go into an unplanned overdraft then tbh I think it's only fair that you pay, not expect others who manage their money properly to contribute.


    (Original post by jacketpotato)
    Still not "free". You are just being subsidised by people who get hammered by charges completely out of proportion to the event, usually people who have low incomes, are in financial difficulties, have special needs or are not financially literate. The person whose wages didn't get paid by their employer one month and got charged £150 in fees because their DDs didn't go through (even though it cost the bank almost nothing in administration costs) is paying for your account. Its an immoral way of running the banking system.

    Of course you are also paying your bank's costs through lower interest rates than you would get in other countries which have a more sensible fee structure.
    People are given information on the charges when they open an account and if they don't manage their money to avoid them then that is their choice. I don't see why you think everyone should have to pay just so that those who are less responsible can do what they like. The person with special needs should have help running their account, making purchases etc from whoever looks after them in the same way a child would have help from their parents. The person who isn't paid by their employer should be going to their employer about the charges, not the other bank customers, though if they are normally good at managing their money and this is the first time the bank is likely to refund if the situation is explained anyway.

    That last point will no doubt be true for higher earners but for people on low-incomes it certainly won't be true.
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    (Original post by StacFace)
    I've lived on my own since September and I've never needed a 'bail out' from my parents or anyone else. I make sure I have the money for the things I buy and that it's in the correct account before it's due to go out. It's called managing your money properly.




    I know what switching involves as I do it myself. I personally think it's worth it, others may disagree and if they do then they can 'pay' via lower interest rates. I don't see how forcing everyone into what is essentially an option b (as they get higher interest rates but have to pay money to the bank out of this) is the better of the two.

    University students get interest free overdrafts up to quite a large amount and other people will get benefits if they really are on that low of an income. If you go into an unplanned overdraft then tbh I think it's only fair that you pay, not expect others who manage their money properly to contribute.




    People are given information on the charges when they open an account and if they don't manage their money to avoid them then that is their choice. I don't see why you think everyone should have to pay just so that those who are less responsible can do what they like. The person with special needs should have help running their account, making purchases etc from whoever looks after them in the same way a child would have help from their parents. The person who isn't paid by their employer should be going to their employer about the charges, not the other bank customers, though if they are normally good at managing their money and this is the first time the bank is likely to refund if the situation is explained anyway.

    That last point will no doubt be true for higher earners but for people on low-incomes it certainly won't be true.
    brilliant- i'd rep you but it says I have already recently!
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    (Original post by Bonoahx)
    Regularly switching bank accounts would be too much of a pain, you'd need to regularly get a new debit card too.

    And some people, like university students, have to take out unplanned overdrafts etc. to live.
    Being lazy is your fault - switching banks is rather easy- especially for savings!

    Let the go-getters get on an not have to subsidise the lazy people
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    (Original post by StacFace)
    People are given information on the charges when they open an account and if they don't manage their money to avoid them then that is their choice. I don't see why you think everyone should have to pay just so that those who are less responsible can do what they like. The person with special needs should have help running their account, making purchases etc from whoever looks after them in the same way a child would have help from their parents. The person who isn't paid by their employer should be going to their employer about the charges, not the other bank customers, though if they are normally good at managing their money and this is the first time the bank is likely to refund if the situation is explained anyway.
    It is not fair to brush everyone who gets faced by charges as irresponsible. I am as financially astute as they come, still got a £30 charge for going 5p overdrawn as a student. Similarly people who face bank charges due to a delay in being paid by their employer (very common for people employed by small businesses) cannot recover these from the employer. It is also unrealistic and patronising to expect everyone with mild special needs or who is not great with money to lose control over their money.

    The fact that information on these charges is available does not make them fair or a sensible fee structure. People should know what the cost of their banking is and pay for it accordingly, not float along under the insane delusion that banking is somehow "free" as if banks were charities and their staff volunteers. I have no objection to people paying the legitimate administration costs incurred by payment problems, perhaps 50p each time, but not for banks to hammer people in financial difficulty with fees and use that to cross-subsidise the rest of their services.
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    (Original post by a729)
    Let the go-getters get on an not have to subsidise the lazy people
    So you are getting a commercial service for free (or at least subsidised), and you blame other people for being freeloaders?
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    (Original post by jacketpotato)
    So you are getting a commercial service for free (or at least subsidised), and you blame other people for being freeloaders?
    You could use the same argument against the NHS
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    (Original post by jacketpotato)
    It is not fair to brush everyone who gets faced by charges as irresponsible. I am as financially astute as they come, still got a £30 charge for going 5p overdrawn as a student. Similarly people who face bank charges due to a delay in being paid by their employer (very common for people employed by small businesses) cannot recover these from the employer. It is also unrealistic and patronising to expect everyone with mild special needs or who is not great with money to lose control over their money.

    The fact that information on these charges is available does not make them fair or a sensible fee structure. People should know what the cost of their banking is and pay for it accordingly, not float along under the insane delusion that banking is somehow "free" as if banks were charities and their staff volunteers. I have no objection to people paying the legitimate administration costs incurred by payment problems, perhaps 50p each time, but not for banks to hammer people in financial difficulty with fees and use that to cross-subsidise the rest of their services.
    If you were a student going 5p overdrawn today you wouldn't have that charge because you should have opened a student account with an interest-free overdraft pretty much as soon as you got your confirmation letter through. In fact even if you weren't a student there are standard current accounts that will let you go slightly overdrawn (ie by less than £5) with no charges.

    If being paid late is a regular occurence then you should regard the date you actually get paid by each month as your payday for budgeting purposes, not the date they give you that's never stuck to. That's just basic common sense.

    Either people are good enough with money to avoid charges or they're not. If someone can't sit down and work out they have £x going out in bills, £y to spend on food etc and stick to it then yes I would say they need help managing their money, not allowed to go over as they please without any negative consequences.

    People know that banks make their money from things like charges, when they say "free banking" they mean free to them as an individual. Under the current system people with little money have the choice over whether to make the effort to do banking properly so it is free or to sit back and accept the consequences. It promotes responsibility. Under a system where you cannot get a free account that choice is removed, which could put people on low incomes who are sensible with their money into financial difficulty, whilst also encouraging those who weren't responsible to do what they like as they no longer have to pay for it. How is that a good thing?
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    It would appear that it's not just the UK that is unhappy with Europe. It's a general trend with only 45% of Europeans supporting the idea. and only the German population supporting it. Then again, Germany seems to be the biggest benefactor of this EU project.

    http://www.spiegel.de/international/...-a-899588.html
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    (Original post by StacFace)
    If you were a student going 5p overdrawn today you wouldn't have that charge because you should have opened a student account with an interest-free overdraft pretty much as soon as you got your confirmation letter through. In fact even if you weren't a student there are standard current accounts that will let you go slightly overdrawn (ie by less than £5) with no charges.
    I did open a student account with an interest free overdraft. The problem is that you had to actually go into the bank, sit for 20minutes in the queue and speak to an advisor to activate the bloody thing. I hadn't done that so I faced a £30 charge (even though I was able to activate the overdraft the next day for free).

    If being paid late is a regular occurence then you should regard the date you actually get paid by each month as your payday for budgeting purposes, not the date they give you that's never stuck to. That's just basic common sense.

    Either people are good enough with money to avoid charges or they're not. If someone can't sit down and work out they have £x going out in bills, £y to spend on food etc and stick to it then yes I would say they need help managing their money, not allowed to go over as they please without any negative consequences.

    People know that banks make their money from things like charges, when they say "free banking" they mean free to them as an individual. Under the current system people with little money have the choice over whether to make the effort to do banking properly so it is free or to sit back and accept the consequences. It promotes responsibility. Under a system where you cannot get a free account that choice is removed, which could put people on low incomes who are sensible with their money into financial difficulty, whilst also encouraging those who weren't responsible to do what they like as they no longer have to pay for it. How is that a good thing?
    I have no issue with the idea that banking can be "free" to the individual if it is carefully managed. No doubt this is a good thing for people who believe in getting something for nothing regardless of whether someone else has to pay for it. Personally I believe that people should be treated fairly and proportionately.

    I simply question whether arbitrarily charging people £20-30 for events which cost the bank perhaps 20p in administration costs is fair. Some people are less financially responsible than others - this was the case in the past, is the case now and will always be the case in the future. Certainly people who are less responsible should bear the legitimate consequences of their actions but I do not see how it can be right to punish .

    People find themselves in financial difficulty (sometimes their own fault, sometimes not - late payment, redundancy, illness, emergency repairs...) are not the kind of people who should be used to subsidise the banking system.
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    (Original post by jacketpotato)
    I did open a student account with an interest free overdraft. The problem is that you had to actually go into the bank, sit for 20minutes in the queue and speak to an advisor to activate the bloody thing. I hadn't done that so I faced a £30 charge (even though I was able to activate the overdraft the next day for free).
    In that case it is because you didn't go into the bank then, still avoidable. Someone who is 'financially astute' would have gone and sat in that queue so that when they needed their overdraft it was there.


    I have no issue with the idea that banking can be "free" to the individual if it is carefully managed. No doubt this is a good thing for people who believe in getting something for nothing regardless of whether someone else has to pay for it. Personally I believe that people should be treated fairly and proportionately.

    I simply question whether arbitrarily charging people £20-30 for events which cost the bank perhaps 20p in administration costs is fair. Some people are less financially responsible than others - this was the case in the past, is the case now and will always be the case in the future. Certainly people who are less responsible should bear the legitimate consequences of their actions but I do not see how it can be right to punish .

    People find themselves in financial difficulty (sometimes their own fault, sometimes not - late payment, redundancy, illness, emergency repairs...) are not the kind of people who should be used to subsidise the banking system.
    As has already previously been said banks are not charities and have to be funded somehow. You couldn't keep free banking and reduce the admin costs to 20p. Besides it's not just admin you're paying for, if you'd taken out a loan there'd be interest to pay, I doubt they'd let you just borrow 5p and if you wanted the money so quickly it'd probably be higher interest too or with some sort of fee for 'fastracking'. If it was really short notice you'd probably be looking at a payday lender.

    People are treated fairly, plenty of info is available on the charges you will receive and for what, they do not let under 18s accounts go into overdrafts, if you are charged and it's the fault of the bank they will refund charges etc. Tbh it just sounds like you're still annoyed at the charge you received because you chose not to spend 20 minutes in a bank queue to avoid it.
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    (Original post by StacFace)
    In that case it is because you didn't go into the bank then, still avoidable. Someone who is 'financially astute' would have gone and sat in that queue so that when they needed their overdraft it was there.
    It is easy to say that with hindsight. It is not clearly highlighted in the documents provided nor on NatWest's website. I am sure that thousands of students must make the same mistake every year.

    It is a very easy mistake to make. One day you will probably make a similar mistake. Perhaps you will slightly misjudge the amount in your account, or your employer will pay you late, or one of your bills is unexpectedly large, or you get distracted from financial matters for a few days due to a family bereavement....

    As has already previously been said banks are not charities and have to be funded somehow. You couldn't keep free banking and reduce the admin costs to 20p. Besides it's not just admin you're paying for, if you'd taken out a loan there'd be interest to pay, I doubt they'd let you just borrow 5p and if you wanted the money so quickly it'd probably be higher interest too or with some sort of fee for 'fastracking'. If it was really short notice you'd probably be looking at a payday lender
    The administration fee for a single missed payment is something like 25p. As I recall this figure was calculated by the FSA.

    Obviously the administration costs of the account itself are larger than this. We are the only country I can think of which uses people in financial difficulties to subsidise everyone else. In most countries which do not adopt such a ridiculous charging structure, there is a small fee for basic accounts (e.g. £1 a month at Standard Chartered in Singapore or US$3 a month at HSBC in the United States) which is waived if you hold a certain amount in the account (e.g. if you hold £1000 in the account you effectively pay the fee through not getting interest or getting a reduced rate).

    The costs of a loan are incorporated into the interest rate of that loan.

    People are treated fairly, plenty of info is available on the charges you will receive and for what, they do not let under 18s accounts go into overdrafts, if you are charged and it's the fault of the bank they will refund charges etc. Tbh it just sounds like you're still annoyed at the charge you received because you chose not to spend 20 minutes in a bank queue to avoid it.
    That's a bit like saying it would be fair to have the death penalty for taking a sweet from a pick-and-mix if it was advertised. There is a proportionality issue here - people should not be getting charged £30 for 25p of costs.

    I don't really care about my charge. But it is not difficult to find people online who got themselves into financial difficulties, often through no fault of their own, and end up being liable for thousands of pounds in bank charges. I simply don't think that can't be justified on moral grounds. Nor is it efficient economics, since charges are usually unexpected and non-transparent (restricting competition on the true costs of current accounts and meaning that people do not typically exercise their right to choose until it is too late).
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    Given that banking isn't free anyway, and that this idea would just make costs clearer... I don't see the problem.
 
 
 
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