Manual intervention? I don't think so!

[martinwhite]

So the figure for bank charges is £3 billion per year.

 

Assuming english billions (i.e. a million millions) and not american billions (a thousand millions) we can see the following:-

 

£3 000 000 000 000 / £35 = 85714 million transactions (i.e. upaid cheques, DDs etc) PER YEAR

 

I work for a company that costs staff time at around £50/hour, but to keep the figures simple, assume £70 per hour, so two of these can be done per hour (if the £35 only covers costs)

 

85714 million / 2 = 42857 million hours.

 

Assuming 2080 man hours in a year:

 

42 857 000 000 / 2080 = 20.6 million man years.

 

So - based on these figures, we can see that there are over 20 million people employed in the banking industry, and all they are doing is manually handling unpaid or bounced transactions.

 

(unless my maths is off! )

Remember that I have used £35 as the average charge. If the "real" figure is less than that then there must be more transactions.

[monkey_uk]

People doing this sort of work won't be on anything near £70.00 an hour, possibly about 10% of that.

[tedblue]

I hope your company are not costing your time

[martinwhite]

I know that, but what it costs the employer in terms of their share of tax, NI, heat, light and insurance. There will be a figure that they cost their time at, which will be a lot more than what they actually pay them.

 

I am on a LOT less than £50 but this is what my company reckon it costs them to have me here!! Obviously if I am working for a client the company charges more.

[martinwhite]

Just to put this in perspective -

 

almost a third of the entire population of the UK must be employed by the banks, just to handle bank charges

[intersimi]

lol, that is funny

[Spiceskull]

...and also a third of the UK population gets charged £100 year in charges (quoted elsewhere in the group)...maybe they are employing these people, charging them £100, and then paying them to process the charge...or something...

 

If the banks made these people redundant then by definition all the charges would disappear...and if they disappeared we wouldn't be able to claim...or something...

 

Having said that, following Martins calculations with solid data would be a useful exercise, and provide good ammunition for people contesting the charges...a pointless question but does anyone know if this information is in the public domain...?

[martinwhite]

I would say that the burden must be on the banks to prove that their costs for each action are, or can reasonably be estimated at, the sum charged. I don't know how they can do this without disclosing exact numbers for the calculations I did.

 

As an aside, suppose you and I started a bank. We know that items will be returned so we set a policy for this.

 

We don't want to get burned in our first year, so we set the fee per return at £30, based on some sensible criteria (as laid down in McAlpine Vs Tilebox).

 

At the end of our first financial year, we find that actually we have overestimated the amount of cost of returning items, by let's say, a factor of 10. This is fine, so far, because we made a genuine preestimate of loss which turns out not to have been accurate.

 

HOWEVER, if we enter the second year of trading and keep the charges at £30, now we are knowingly charging more for our losses than it costs us, and we fall foul of the law.

 

There is simply no excuse for a bank which has been running for years and years, not to know EXACTLY what it costs them, and therefore what they could fairly and legally charge.

[Spiceskull]

...following the same argument, a £5 annual rise in charges each year is also wrong. As this represents a 16% rise over the last 12 months, I don't see how they can 'pre-estimate' their costs rising by 16%. This is in the environment where their costs are actually reducing due to offshoring, and other factors.

 

So even if the originl pre-estimate can be proved (which is unlikely) the steep rises cannot be legally justified, and are therefore not lawful...

[martinwhite]

Exactly. And there, m'lud, i rest my case!

[martinwhite]

This topic was closed on 03/07/19.

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