How charges are worked out when u go overdrawn

[Andy999]

Apparently Barclays works as follows....... Out before in.

 

For example If you go into your branch to pay a bill, and to deposit the cash to cover it, then the bill will only be paid if you already have sufficient funds in your account to cover it !

 

Debits are applied to your account before credits.

 

Kind of. Debits that come out of your account overnight (cheques, Standing orders and Direct Debits) are applied after credits that go in overnight (salary payments etc). Therefore the amount credited will not be taken into consideration when deciding whether to pay a direct debit etc. There should be funds in the account at the close of business on the previous day to cover any payments and avoid charges.

 

I worked for Barclays until last year, but doubt these things have changed since then.

 

If you have Direct Debits, Cheques or Standing Orders due out of your account, you should have sufficient funds available to pay them in the account by the close of business on the previous working day. Note that, at many branches, credits made during the last hour or half hour of business are not processed until the following working day. There should be a notice giving the counter cut off times displayed in each branch. Barclays will pay against uncleared cheques, up to £1000 per customer, provided the account is not marked as high risk.

 

At the start of each day, a list of all items due to go out of accounts with insufficuent funds is generated. Some of these items will be paid anyway (if it's a small amount or if you have run a good account with the bank). You'll be charged a Paid Referral for going overdrawn by more than £5, which was £25 when I worked there but I think is now £30. These are calculated on the balance at the close of business each day - so if a Direct Debit goes out overnight and makes your account overdrawn, you can pay in cash that day to cover it and avoid a charge.

 

If your balance goes overdrawn by a further pound on a subsiquent day, you will be charged another fee. You will be charged a maximum of one fee per day and three fees per month (where month means your statment period, not calander month). I believe that your first paid referral fee each year is now automatically refunded a few days later. That was introduced just before I left, but may have changed now.

 

If an item is unpaid (bounced), you will be charged an unpaid item fee, which is now £35. You will only be charged one of these per day (even if 10 items bounce), but there is no limit on how many per month you will be charged. If you pay in cash that day, it is technically possible for a member of staff to change a direct debit or standing order to be paid, although in the case of direct debits most staff don't know how to do this. Cheque status cannot be changed unless the bank has made an error, and it's early in the day.

 

There's also a "Chaque Guarantee mis-use fee". I don't know how much this is, and only ever saw one customer being charged them. These apply when a cheque is paid which would have bounced had it not been guaranteed. I'm unsure of the rules surrounding these fees as they were very rare.

 

All the above charges are applied on the day the "service" was provided.

 

The same also applies to Student accounts, but the fees are lower.

 

Premier Banking and Business Banking have their own rules, so I can't comment on charges on these kinds of accounts.

 

Sorry for the length of this message...hope it's clear though.

[Andy999]

You're entitled to be able to withdraw your benefits - but you need to tell the bank you need to do this. I don't specifically know about A&L but there is more than likely a certain department you need to speak to in order to authorise this. The Phone Banking staff probably won't know much - ask if they have a debt management department you can speak to.

 

Alternatively, divert your benefits into another account, set up no DDs on the new account and ensure you don't ever get into a situation where charges can occur. If you are planning on claiming back the charges from A&L, these should clear the overdrawn balance on that account.