Important changes to my Barclays current account

[wheresmyhairgone]

Hi

Just thought i,d tell you about a letter i recieved from Barclays today. It might show what the banks are up to behind the scenes concerning the bank charges.

 

 

Basics of the letter are as follows :

 

Important changes to you current account from 18/08/2008

 

We`re introducing persenol reserve, giving you access to emergency funds, to help you avoid having payments returned unpaid.

 

We`re changing the fees we charge when you have exhausted your account balance blah, blah.

 

cut a long letter short here are the charges for a personal reserve :

 

FROM THE 18/08/2008 THE FOLLOWING CHARGES APPLY:

 

RESERVE USAGE FEE £22 per five working day period

 

returned transaction fee £8 per transaction

 

guaranteed transaction fee £8 per transaction

 

if you wish to opt out of a reserve after 18/05/2008 you can do so at a branch or by calling us on 08450301 0880.

 

excuse me if anything like this has already been posted

[BeauBrummie]

Hello wheresmyhairgone,

 

Yes there have been other posts regarding this issue, here is one that I am subscribed to http://www.consumeractiongroup.co.uk/forum/barclays-bank/148460-have-barclays-conceded-defeat.html

 

I got exactly the same letter last weekend and I am still digesting the ins & outs, but basically Barclays are changing your original T&C's from when you opened the account. Now is this right we ask.........Is it legal we ask....cos it sure aint any better for the Barclays customer IMHO anyway.

 

BB

[wheresmyhairgone]

Hi Beau

 

What makes me smile is that i have been offered £1000 PERSONAL RESERVE but i already knew i had this amount to fall back on,my bank manager called it an unofficial overdraft.This PERSONAL RESERVE is the same thing but a smaller charge that can be charged more times in a 1 month cycle.

[Bookworm]

Ooh, you're lucky you have a bank manager, and that he tells you things!

 

I always knew I had an unofficial limit under which the bank would pay up and above which they wouldn't, but they never told me which and I never knew what it was exactly...

 

One big gap of knowledge in the new terms is what happens if you opt out and go over: Do they bounce everything and charge you £8 for the bouncing? I have gone through their literature pretty thoroughly, but it doesn't actually say. If they don't, then it would seem that you would be better off opting out, as you would then only get the £8 and not the £22, so I have my doubts. If they do bounce everything and charge you the £8, then you have to decide whether you'd rather payments were met, pay the £22 reserve fee and stay opted-in, or have them bounced and pay the £8 for that.

[wheresmyhairgone]

Hi BW

I,m lucky enough to live in a small community ( well us`ed to be lucky, not so much now with with local post office being closed down and the price of petrol).

 

My bank managers child and mine go to the same village primary school so i know her pretty well. Anyway we got to discussing my bank account and thier charges one sports day and she told me to come into the branch and discuss them.

 

I went in and because i was self employed she suggested i applied for an overdraft (most of the charges were for being overdrawn without an overdraft facillity) she said i will still incur charges but not as many. She fired up the old PC looked at me and said it shouldn`t be a problem because i had an unofficial £1000 overdraft anyway ( that explained why they still paid my bills and i could still use my debit card even thou the account was in the red)

 

Anyway i applied but it got turned down because in thier words my account wasn,t being run propaly.

 

Still got the unofficial overdraft thou, could it be because it makes them more money then an official overdraft me thinks.

[BeauBrummie]

Hi Bookworm,

 

My blurb that came with my letter states that if you opt out and go over your agreed limits, you will pay " Returned Transaction" or "Guaranteed Transaction" as appropriate.

 

One presumes the "status quo" applies

 

BB

[Bookworm]

Well no. You see, the "guaranteed transaction" is for things where they have no choice, like cheques covered by the cheque guarantee card. "returned transaction" speaks for itself.

 

My point is that at the moment, there are all those transactions which they do let through (card, D/D, S/O etc...) up to the unofficial limit. If oyu opt-in, you will still have that up to the limitof the reserve. It doesn't say what happens to those transactions if you opt out. A rather glaring omission.

[wheresmyhairgone]

Just got a letter from barclays again today :

 

you may not be aware that on 2nd june your barclays bank account was £--.-- overdrawn without an agreed overdraft limit.

 

Whilst this position does not cause us concern ( lol bet it doesn`t kerching, kerching! )

 

last paragraph :

 

We would be happy to consider an application for an overdraft limit, to help you AVOID such unnecessary charges ( in thier own words, if i was given an overdraft then i wouldn,t get these £30 charges)

 

Anyway thought i would phone them on number provided, i asked for a £1000 overdraft, and again was turned down.

 

I asked why not i have a £1000 unauthorised overdraft but not an unauthorised one, is it because you make money from me if it stays unauthorised, " of course not sir " i swear i heard him snigger.

 

I asked why not, you have offered me a £1000 PERSONAL RESERVE, is it because you make more money from meif it stays PERSONAL RESERVE

" of course not sir " must of had the phone on loudspeaker, swear i heard the whole office sniggering.

 

Oh by the way Bookworm i asked the question, and if i opt out my the charges for transaction fees stays at £30 & £35.

 

So as i see it the £22 is a way of getting round the bank charge argument.

I go overdrawn cost me £22+ £8 = £30 exactly the same except thay can charge £22 EVERY 5 WORKING DAYS.

 

I,m going to opt out because as i see it i won,t be able to get the £22 back what ever happens in the future because it will be a fee not an unjust fine

[Bookworm]

Oh by the way Bookworm i asked the question, and if i opt out my the charges for transaction fees stays at £30 & £35.

Well, they've kept that one quiet... the fact that it is does not appear anywhere in the new T&Cs may provide grounds enough to challenge those in the future, actually... How is one supposed to know what option to choose if one is not given all the options, I wonder?

[wheresmyhairgone]

Whats bugging me is the fact that they have ( or will be on 18/08/2008) be giving me £1000 PERSONAL RESERVE or unauthorised overdraft as i like to call it, but won,t let me have a £1000 agreed overdraft.

 

Its so blatantly obvious that the reason they won,t is because one will make them more money then the other.

 

They have told me that they realise because i am self-employed and do not have a regular income i.e a certain amount of money going into my account on a certain day, that i need emergency funds to cover me when an invoice is not paid on time.And that is what the personal reserve would be for.

 

Well if they think giving me a £1000 personal reserve is not a risk, why do they think that giving me a £1000 agreed overdraft is a risk.

 

ITS TO MAKE MORE MONEY AND I DON,T SEE HOW THEY CAN ARGUE THE FACT

[zootscoot]

Have you not filled in our complaint about these changes?

 

http://www.consumeractiongroup.co.uk/forum/campaign/146952-complain-fsa-about-misleading.html

 

I'm very jealous I only got offered £500 reserve needless to say I opted out

[BeauBrummie]

Well, they've kept that one quiet... the fact that it is does not appear anywhere in the new T&Cs may provide grounds enough to challenge those in the future, actually... How is one supposed to know what option to choose if one is not given all the options, I wonder?

 

So the Status Quo does apply, I am again looking through the info, and if you do not do anything, you are opted in automatically. So if you do not opt out you will have these changes forced upon your account, this seems to me that Barclays are relying on the general public's niavity in financial matters to offset their potential losses when the test case result is finally given against them.

 

Am i right in thinking that this scenario goes against the Banking Code of Conduct ?

 

Zootscoot, I too have only been given a "Personal Reserve of £500 and as with you wheresmyhairgone, I cannot get a "Authorised Overdraft" and I am Self Employed.

 

I think that I may well at the end of the day be opting out but I need to do some sums first (should'nt be to hard I am a partialy qualified Accountant) comparing the old system including the maximum of 3 "referral fees" per month against this new and obviously better!!! (because Barclays says so) personal reserve.

 

BB

 

 

 

 

better there own

[wheresmyhairgone]

Just filled in the complaint to FSA ZOOTSCOOT.

 

Now if i,m honest i really didn,t mind being charged £30 when the bank paid my mortgage when the funds were not there, but i,ve tried to work out the difference betwwen the two, please correct me if my sums are wrong :

 

My mortgage goes out on the 1st of the month, its the only dd i have on this account.

 

without personal reserve

 

On the first of August my mortgage goes out, i havn`t got the funds to cover it and i do not put any funds in until 31st August.

 

result for that month

 

£30 fee plus interest at 2.05%.

 

same scenario with personal reserve

 

4x £22 or is it 5x because it will fall into a 5th week

1x £8

interest at 2.05%

 

that could be a possible £118 + interest whereas now it is £30+interest

 

i will be opting out for the £30 + interest

 

but the question is if i opt out will i still have my £1000 unauthorised overdraft

[zootscoot]

If you opt out you still only pay the £8 fee but the mortgage will not be paid. So no you will not get your unauthorised overdraft. The benefit from having the reserve or the service which you pay for is having the payment met. That will be taken away if you opt out. With mortgage payments this may well be crucial as missed mortgage payments will impair your ability to get future mortgages.

[wheresmyhairgone]

ZOOTSCOOT please read no. 3 & 4 , and if i opt out i have been told the charges would remain the same as now £30 +£35

[zootscoot]

Who told you that?

 

If you open the word document in the following link it gives a chart of which fees apply to which accounts. (you may have to copy and paste to enlarge it) It states that the guaranteed transaction fee and the returned transaction fee (as oppose to the current unpaid item and paid refferal fees) apply where you have just the authorised overdraft or no overdraft at all.

I did ask Barclays and they said it was the £8 charge.

 

Barclays.com | Media Centre | News Releases | Barclays overhauls current accounts to make banking simpler and clearer for consumers

[wheresmyhairgone]

The person on the phone at barclays when i rang them to ask why they have offered me £1000 personal reserve but keep refusing me £1000 agreed overdraft even thou they keep sending me letters inviting me to apply for one.

[zootscoot]

It seems even Barclays can't make up their minds whether the old or new charges apply

[wheresmyhairgone]

I think the reason i started this post is because i have always had this £1000 PERSONAL RESERVE but it was called a unauthorised overdraft ( see post no.3 ). As did BOOKWORM ( post no. 4).

 

My point is in the past when i have applied for a £1000 agreed overdraft i have always been turned down stating my account wasn,t being run properly.When i have suggested that the reason it was turned down was because they made more money from me by not giving me an overdraft, they always denied it.( i am the goose laying thier golden eggs, why change it)

 

But now they have sent me a letter telling me i have a £1000 personal reserve (unathorised overdraft whichever way you look at it) but they have again turned down my aplication for a £1000 agreed overdraft.

 

My point is ( i think ) how can they defend the reasons for not giving me

an agreed overdraft when they have just offered me an agreed unathorised overdraft ( PERSONAL RESERVE )

 

Its because they make more money from me by not giving me an agreed overdraft, in the past they could deny this but now i think they can not.

 

turn me down for an £1000 agreed overdraft but offer me a £1000 unauthorised overdraft. there can be only one reason.

 

the latter generates more BANK CHARGES

[yourbank]

The question I would ask you, and this is something I cannot answer, is that say we take the last 3 months, would their new system have been cheaper or more expensive(I know that they won't give you an authorised overdraft)? If we say that they charge £22.00 for the personal reserve of £1000.00 and £8 per unpaid item and card payment over the reserve limit(that is how I understand it, I think). Are you worse off under current or proposed system?

[wheresmyhairgone]

I think i,ll be worse of under the proposed system as i see it, the £22 would be payable every 5 days while i,m overdrawn. At the moment it is a one off £30 payment however long it takes me to get back in the black.

[yourbank]

just to clarify my question, that is based on 5 working days ie a normal 7 days incl. saturday and sunday?

 

I guess I am interested in whether the old or new system proposed is as it is allegedly supposed to be, ie "better" for customers.

[wheresmyhairgone]

But to get back to my main gripe.I will try to put it simpler because i realise i may have been rambling abit.

 

Every month for the last 12 months i have applied for a £1000 overdraft and every time it has been denied because my account has not been run properly. Now we all know its because they make more money from me if i don,t have an overdraft, and many thousands of others. but the fact is i cannot argue thier reasons

 

But now they have offered me a £1000 personal reserve the average is £500 i assume i was given £1000 limit because my account is usually back in the black before the end of the month.

 

Now my point is that maybe i could now challenge thier reasons for not giving me an overdraft

 

Surely if i,m seen as a risk for an overdraft, i must be a risk for personal reserve.

 

Surely they can not now deny that the reason is THE CHARGES

[wheresmyhairgone]

Sorry YOURBANK

 

I will quote from thier Q&A booklet.

 

no. 13

Q.What if my balance is still in my reserve after five working days?

A. YOU WILL INCUR A FURTHER RESERVE USAGE FEE OF £22 AND A NEW PERIOD OF FIVE CONSECUTIVE WORKING DAYS WILL BEGIN

[yourbank]

That is a wrong assumption IMHO albeit, i do understand your rationale for saying that. Applying and getting an overdraft is based on a number of factors, income being one of them, credit scoring and how the account has been run previously. The charges have been because of an action ie a cheque written out, a standing order going out, a direct debit going out, or even floor limits of a shop that has caused the account to trigger charges. Those charges are caused by an action.

I am not of the opinion that the bank intentionally wants to charge you because that would suggest that everyone gets banks charges regardless. That isn't the case. However, the amount of the charge and the way they are applied does not necessarily help the individual. Maybe what the bank could have done on the initial issue was to increase/add an overdraft to the account to prevent further charges and better advice how the charges work. That would both mean that initial cause of a charge would be dealt with and internal credit score may have been better and at the same time making sure you know why and how to avoid charges in the future.