[Johnny 1989]

Just a quickie here, I have a query regarding money transfers, now from what I understand it's fairly straight forward, however if I wanted to transfer, say £500 and I only had £300 in my account would my bank still let me transfer £500.

Don't worry I haven't been duped by any dodgy Nigerian email about sending money urgently or the like, this is more to do with holiday money.

Thanks in advance for any help & advice.

[dimtimjim]

Erm.... Your bank would be the best peeps to ask, but unless you have a 200 squid overdradft, I would guess not..... Unless you mean transfer 500 into your account, in which case i'm sure the bank won't mind at all and will quickly add it to their x-mas bonus fund.

*ing *s.

[Yudster]

Ask Foot Loose, he is the forum's banker.

[foot-loose]

Just a quickie here, I have a query regarding money transfers, now from what I understand it's fairly straight forward, however if I wanted to transfer, say £500 and I only had £300 in my account would my bank still let me transfer £500.

If you have an overdraft facility then yes, they would let you transfer it over. They also might allow you to go overdrawn, but would charge you for it. If taking that extra £200 takes you over the agreed overdraft limit, why not ask them to increase the overdraft limit?

Ask Foot Loose, he is the forum's banker.

I have a day off from banking today.

[dimtimjim]

Foot loose is lovely, I won't hear of him being spoken about like that. Horrible.



Oh, you said Banker. Oops.

[Johnny 1989]

Ah right sorry I was a bit unclear above, I have a rather large arranged overdraft facility but I'm just in it as of this morning (bloody train fares) a few friends of mine are going to lend me some money in the mean time.

But seeing as my internet provider likes to bill me at random times of the month, I was just worried that once they had transferred the money to my account that during the transfer I need to make to my cousin for him to change the money from GBP to HKD they take some of that money for theirselves which may cause problems with the transfer as I'll then go into my arranged over draft.

Apologies if this makes no sense I really don't get the whole banking thing I'm afraid.

[foot-loose]

If it is an arranged overdraft then you wont be breaking any rules which means you wont have any high fines. You will still have to pay interest but it shouldn't be too hight as long as it's just for a few days. I have heard that HBOS (Halifax) are going to be charging you £1 a day if you are in an arranged overdraft so just watch out for that if you are with them.

[Johnny 1989]

If it is an arranged overdraft then you wont be breaking any rules which means you wont have any high fines. You will still have to pay interest but it shouldn't be too hight as long as it's just for a few days. I have heard that HBOS (Halifax) are going to be charging you £1 a day if you are in an arranged overdraft so just watch out for that if you are with them.

That's who I'm with sadly, although this kicks in on 6th December. However if I do go into my overdraft it will be cleared once I get paid on the 30th November as I won't be spending any money over here.

Thnaks for the info Foots that's put my mind at rest a bit

[foot-loose]

I phoned Bank of Scotland and said I wasn't to impressed with their new overdraft ideas. I think the poor lad I spoke to had spoken to about a hundred other people saying the same thing - I was nice to him, but it's a shit move from my point of view.

I blame the folk that couldn't look after their bank accounts then claimed back the bank charges. *stirs the shit*

[Munki Bhoy]

If the bank can charge you excess money for it, then yes they'll let you do it. They'll probably encourage you too. In fact, if you have £300 quid and a £200 quid overdraft you'll probably find they remove your overdraft just before you transfer the money, therefore allowing themselves to charge even more for the privilege.

All of this is completely government backed and indeed funded. Bend over and take it big boy, * you.

[AndyJ]

I have heard that HBOS (Halifax) are going to be charging you £1 a day if you are in an arranged overdraft so just watch out for that if you are with them.

Jammy *. In September they put my Overdraft up to £1500 from £300... £300 was fine for me. I guess they think now I have the larger Overdraft I will go wild and spend it all so they can get more money from me. Bugger that, it's rare I use my Overdraft...

[foot-loose]

Depends how you look at it. If you take £1500 out as cash on a credit card, you would be paying a lot more than the £31 max back as interest.

It annoyed me since I rarely use my overdraft facility and the one time I recently went into it (I had forgotten about a direct debit coming off), I had moved funds in within two days. I don't actually think the interest I owed them for the two days ever appeared since the account had been in credit for the rest of the month. Now they are telling me that I would owe them £2 for that. It's £2, but it's significantly more expensive to me than it was before.

[Johnny 1989]

I phoned Bank of Scotland and said I wasn't to impressed with their new overdraft ideas. I think the poor lad I spoke to had spoken to about a hundred other people saying the same thing - I was nice to him, but it's a shit move from my point of view.

I blame the folk that couldn't look after their bank accounts then claimed back the bank charges. *stirs the shit*

Cheeky *!

I always pay back my over draft every month. I just keep falling into the * thing every month. A friend is going to help me financially in January, he's good at that sort of thing (although knows nothing about money transfers as he's never done one ) I'm going to cut it down by quite a bit once I'm in the black for a few months again.

I have heard that HBOS (Halifax) are going to be charging you £1 a day if you are in an arranged overdraft so just watch out for that if you are with them.

Jammy *. In September they put my Overdraft up to £1500 from £300... £300 was fine for me. I guess they think now I have the larger Overdraft I will go wild and spend it all so they can get more money from me. Bugger that, it's rare I use my Overdraft...

They did that with me, £300 went up to £1000 which was knocked back once but they then decided to up it to £1500. The fact we aren't getting a payrise in my firm until January 2011 Really doesn't help. Once I've got my money situation sorted out the over draft is getting right cut back I can assure you that!

[MK Chris]

I blame the folk that couldn't look after their bank accounts then claimed back the bank charges. *stirs the shit*

I know this was a tongue in cheek comment, but... if the companies in question (including your employers) weren't so unethical and charging disproportionate fees in the first place, they wouldn't have to... fair enough, charge a fee - but if these people are going over their overdraft limits or getting direct debits bounced, they are either not in a position to afford hefty fees or they are simply not good at managing their finances (or both). Some people are very good at juggling their money; others are not. People who have no sense of direction are not penalised by the Government for using the roads more, the only financial penalty they get is the extra petrol they use for going the wrong way. I know banks are businesses and have to make profits, but their profit margins are ridiculous - even now - and all they do is pay their directors fat bonuses. The US has put a stop to this, but we don't seem to have done.

As far as bank charges are concerned - the banks know they are unfair, but they continue to charge them. That's why they were paying out before this test case came to light and that's why the credit card companies, with their charges, are still paying out to avoid justifying them in court. Bank charge reclaiming is simply a way that the consumer (with the help of people like Martin Lewis) has found to get back at the banks for treating them like shit and what do they do? They respond by putting up overdraft charges. Well what a pile of wank.

[foot-loose]

I blame the folk that couldn't look after their bank accounts then claimed back the bank charges. *stirs the shit*

I know this was a tongue in cheek comment, but... if the companies in question (including your employers) weren't so unethical and charging disproportionate fees in the first place, they wouldn't have to... fair enough, charge a fee - but if these people are going over their overdraft limits or getting direct debits bounced, they are either not in a position to afford hefty fees or they are simply not good at managing their finances (or both). Some people are very good at juggling their money; others are not. People who have no sense of direction are not penalised by the Government for using the roads more, the only financial penalty they get is the extra petrol they use for going the wrong way. I know banks are businesses and have to make profits, but their profit margins are ridiculous - even now - and all they do is pay their directors fat bonuses. The US has put a stop to this, but we don't seem to have done.

The fee has to be high otherwise people would take the piss and go overdrawn all the time. I can't talk for all the banks, but the one I work for will refund any charges twice and each time they do that they will explain to the customer what has happened and how to avoid that in the future. If the customer is "not good" at juggling their money, why is that the banks fault?

Your analogy of the Government not charging people more for driving further... how else would they government charge for this other than through petrol charges? I see where you are coming from but I think you kinda pissed on your own bonfire there sir.

As far as bank charges are concerned - the banks know they are unfair, but they continue to charge them. That's why they were paying out before this test case came to light and that's why the credit card companies, with their charges, are still paying out to avoid justifying them in court. Bank charge reclaiming is simply a way that the consumer (with the help of people like Martin Lewis) has found to get back at the banks for treating them like shit and what do they do? They respond by putting up overdraft charges. Well what a pile of wank.

Why should the banks provide a current account for free? I've said this before, I don't pay anything for mine since I have an idea how to look after money and have avoided going overdrawn. Now, I accept that I have been lucky and have never been in the situation (yet!) where I have been unemployed and been in financial difficulty. I understand that people can end up using overdrafts or credit cards simply because they have no other choice. I am having this argument from a totally selfish point of view and simply asking why, when I have maintained my account correctly, should I be penalised? The current account (and credit cards) have to make financial sense to a bank otherwise what's the point of them providing the service? If the banks cant charge those who don't look after their accounts, they will need to charge everyone. I think we had this discussion about a year ago and at the time I said that I wouldn't be surprised if we all start getting charged an annual fee for the use of the account. I don't think that's too far away now.

If I go ten pence overdrawn now for two weeks, I get charged £14. That, by the way, is into an AGREED overdraft. How is that right?

[MK Chris]

The fee has to be high otherwise people would take the piss and go overdrawn all the time.

Maybe I'm being naive, but I don't think you would get any more people overdrawn than you do at the moment - people don't like going overdrawn, they do it if they have to.

If the customer is "not good" at juggling their money, why is that the banks fault?

It's not and I'm not saying their shouldn't be a fee, but a fiver is quite sufficient. They would still earn lots out of it.

Your analogy of the Government not charging people more for driving further... how else would they government charge for this other than through petrol charges? I see where you are coming from but I think you kinda pissed on your own bonfire there sir.

Pay-per-use roads would penalise this more. But yeah, it maybe was a bad analogy. The point is that everyone is good at some things, but not others. Those who are good at managing money generally can't see how those who aren't good at it can be so shit. No it's not the bank's fault, but equally the bank is doing nothing to help this person get out of trouble by charging extortionate fees.

Why should the banks provide a current account for free?

The banks can well afford to provide a free current account and charge a person a fiver for going overdrawn and returned direct debits - the price of a first class stamp is 39p I believe - if we assume the banks don't get a bulk discount for postage (they almost certainly will do) and that they send these letters first class (they may or may not, I'm not sure), that is a profit of £4.61 for every customer, every time they go overdrawn and have a direct debit returned, not to mention the profits they make from other sources. Now I would prefer to pay a fiver a month for a current account and have them charge those rates, but they could easily afford to do it without charging for current accounts.

If I go ten pence overdrawn now for two weeks, I get charged £14. That, by the way, is into an AGREED overdraft. How is that right?

It's not.

[Boboff]

Foots, the answer lies in who the Banks want as customers.

They would ideally have everyone completely maxed out on the OD by the end of each month, they get paid, and the mortgage or rent comes out and they are overdrawn again, so they get the big bucks. As you say, people who only "dip" by a few pounds don't earn the banks enough money. The Banks are mega creaming the profit now, just to sure up their balance sheets.

Take a £100,000 mortgage, 18 months ago the above base premium for most was 1.5%, now its 3.5%, so thats £2000 a year extra profit where the risk is still pretty much the same, at 20 million households thats an increase in the inherent profitability of the market of £20 Billion a year, or about 25% of the total profit from the FTSE 100. This will start to improve things, but at the end of the day we are paying through tax to bail them out and then again to repay the Tax Man, the only benefit is that it should help the stock market which will in turn help pensions and investments (i.e. the old people with no mortgage! )

As for excess charges, we all have a choice, I am with RBS (Virgin that was) and as you say when there has been an error I have called and complained and they have refunded me. I also agree free banking is really a nonsense. What I don't get is really the mindset. If you have no overdraft you can't go overdrawn, if you have £1500 already loaned to you on overdraft, you can't spend any more.... why put yourself in the place where you have to borrow to live every month, it's costing you, and slowly eroding your standard of living. My feeling is you save like a bastard until you have a couple of grand in your account, and you use that as an emergency overdraft, ok it's hard to get their, but surely it's only as hard as repaying a £1500 overdraft once you get there? I appreciate that I may sound a twat for not understanding the extreme financial pressures people are under, but it is what I think. "A borrower or lender do not be" as my Grandad used to say.

[foot-loose]

The fee has to be high otherwise people would take the piss and go overdrawn all the time.

Maybe I'm being naive, but I don't think you would get any more people overdrawn than you do at the moment - people don't like going overdrawn, they do it if they have to.

The reason people don't like it is because they get charged a fortune. If it didn't affect them, why would they care?

If the customer is "not good" at juggling their money, why is that the banks fault?

It's not and I'm not saying their shouldn't be a fee, but a fiver is quite sufficient. They would still earn lots out of it.

But would a fiver be as serious to someone as forty quid? Or would the response be "ah, just go overdrawn - it's only a fiver". The whole point of the extortionate fees is to scare people into not breaking the rules.

Your analogy of the Government not charging people more for driving further... how else would they government charge for this other than through petrol charges? I see where you are coming from but I think you kinda pissed on your own bonfire there sir.

Pay-per-use roads would penalise this more. But yeah, it maybe was a bad analogy. The point is that everyone is good at some things, but not others. Those who are good at managing money generally can't see how those who aren't good at it can be so shit. No it's not the bank's fault, but equally the bank is doing nothing to help this person get out of trouble by charging extortionate fees.

The difference is that the banks are (or were, until recently) a private business which are there to make money. The government are a public service elected by us and not really there to make a profit.

Why should the banks provide a current account for free?

The banks can well afford to provide a free current account and charge a person a fiver for going overdrawn and returned direct debits - the price of a first class stamp is 39p I believe - if we assume the banks don't get a bulk discount for postage (they almost certainly will do) and that they send these letters first class (they may or may not, I'm not sure), that is a profit of £4.61 for every customer, every time they go overdrawn and have a direct debit returned, not to mention the profits they make from other sources. Now I would prefer to pay a fiver a month for a current account and have them charge those rates, but they could easily afford to do it without charging for current accounts.

I don't know much about postage, but I'm pretty sure that any discounts available to the banks will be available to anyone else doing bulk postage.

As I said earlier - the charges are one of the ways the banks make money. If it suddenly becomes a lot less profitable, they will want to make the money through other means. The reason the charges were so high was because it was a way of preventing people from breaking whatever rules they had agreed to when they opened the account. The banks attitude will be "fine, no more charges - everyone needs to pay £30 a year for their account, oh, and £1 a day for going overdrawn. Is that fairer for you?".

Yes, it's fairer, I don't argue that - it treats everyone the same. It bloody costs me money though. Money I didn't have to pay before.

Foots, the answer lies in who the Banks want as customers.

They would ideally have everyone completely maxed out on the OD by the end of each month, they get paid, and the mortgage or rent comes out and they are overdrawn again, so they get the big bucks. As you say, people who only "dip" by a few pounds don't earn the banks enough money. The Banks are mega creaming the profit now, just to sure up their balance sheets.

Take a £100,000 mortgage, 18 months ago the above base premium for most was 1.5%, now its 3.5%, so thats £2000 a year extra profit where the risk is still pretty much the same, at 20 million households thats an increase in the inherent profitability of the market of £20 Billion a year, or about 25% of the total profit from the FTSE 100. This will start to improve things, but at the end of the day we are paying through tax to bail them out and then again to repay the Tax Man, the only benefit is that it should help the stock market which will in turn help pensions and investments (i.e. the old people with no mortgage! )

I know nothing about mortgages. I don't know how they work or where the profits come from. My argument is looking at current accounts as a stand alone product.

As for excess charges, we all have a choice, I am with RBS (Virgin that was) and as you say when there has been an error I have called and complained and they have refunded me. I also agree free banking is really a nonsense. What I don't get is really the mindset. If you have no overdraft you can't go overdrawn, if you have £1500 already loaned to you on overdraft, you can't spend any more.... why put yourself in the place where you have to borrow to live every month, it's costing you, and slowly eroding your standard of living. My feeling is you save like a bastard until you have a couple of grand in your account, and you use that as an emergency overdraft, ok it's hard to get their, but surely it's only as hard as repaying a £1500 overdraft once you get there? I appreciate that I may sound a twat for not understanding the extreme financial pressures people are under, but it is what I think. "A borrower or lender do not be" as my Grandad used to say.

Seconded.

We live in a culture where we buy before we can afford something. The way we look at it is "can I afford the repayment on that car?" not "can I afford that car?".

[MK Chris]

The reason people don't like it is because they get charged a fortune. If it didn't affect them, why would they care?

Yes. People are tight, they don't like being charged a fiver if they can help it. Thing is, people who are good at managing their money will always be good at it and those who aren't will never be - for that reason, I don't think the number of people going overdrawn would really go up.

If the customer is "not good" at juggling their money, why is that the banks fault?

It's not and I'm not saying their shouldn't be a fee, but a fiver is quite sufficient. They would still earn lots out of it.

But would a fiver be as serious to someone as forty quid? Or would the response be "ah, just go overdrawn - it's only a fiver". The whole point of the extortionate fees is to scare people into not breaking the rules.

No it's not, it's to earn the banks as much money as they can possibly squeeze out of their customers.

The difference is that the banks are (or were, until recently) a private business which are there to make money. The government are a public service elected by us and not really there to make a profit.

I understand that, but the banks still do make mega bucks and still would make a profit if they charged £5 for people going over their overdraft. They are out to cream the consumer for everything they can.

I don't know much about postage, but I'm pretty sure that any discounts available to the banks will be available to anyone else doing bulk postage.

I'm not disputing that, my point was to illustrate how much the banks would still make from a person going overdrawn even if they charged £5 for it.

The fact is, they wouldn't make as much money, although I still reckon they would profit - if they did (and the only way that could happen is if more people, as you have suggested, went over their overdraft limit), they'd be doing it.

As I said earlier - the charges are one of the ways the banks make money. If it suddenly becomes a lot less profitable, they will want to make the money through other means. The reason the charges were so high was because it was a way of preventing people from breaking whatever rules they had agreed to when they opened the account. The banks attitude will be "fine, no more charges - everyone needs to pay £30 a year for their account, oh, and £1 a day for going overdrawn. Is that fairer for you?".

£30 a year I wouldn't argue with; £1 a day for being overdrawn I would.

As I said above though, if more people went over their overdraft if the banks charged £5 for doing it, why would it be less profitable?

[Latina]

I'm sure there are people out there who know way more about how to manage money properly than I do, but I've never understood which part of "Don't buy what you cannot afford" is so difficult to grasp.

That's an honest statement.

[Johnny 1989]

What have I started

If anything me getting into my overdraft is my own fault & is something I need to get out of it, which I can quite easily get out of in 2-3 months. I don't have a credit card (thankfully) and refuse to get one.

I'm getting help with my finances in the new year so I should be able to turn this back round again. Once I'm a coupel of grand back in the black I'll be cutting my overdraft back down to £500.

As for what you said earlier Foots, someone confirmed to me at work that a bank will do a money transfer if you do go into my overdraft. If they won't I'll transfer the money I'm being lent & whatever extra I need I'll withdraw in GBP. It'll all go back in on the 30th November so I'll avoid the overdraft charge (Halifax can shove that right up their arse).

[Boboff]

See from my point of view the £1 a day is a tactic that is working to stop people going into the overdraft, something which has to be a good thing, if it's the difference between thinking about it and not then doing it, i.e. providing a motivation for people to change their behavior.

Toph you are very left wing.

Charl.... You are an adult, just treat money in the Bank like you would if it was cash in your wallet. If it empty you have to work to fill it up again.

[Johnny 1989]

See from my point of view the £1 a day is a tactic that is working to stop people going into the overdraft, something which has to be a good thing, if it's the difference between thinking about it and not then doing it, i.e. providing a motivation for people to change their behavior.

Toph you are very left wing.

Charl.... You are an adult, just treat money in the Bank like you would if it was cash in your wallet. If it empty you have to work to fill it up again.

That's what it's done for me, I have been living off the overdraft for too long, this change in December means I'm now going to stop wasting my money on silly things & only spend it on essentials.

[Zoot]

Things like this are exactly why I don't want to be an adult.

Plus, as an adult you get really funny looks when you race the go-karts round the aisles in Toys R Us.

[foot-loose]

The reason people don't like it is because they get charged a fortune. If it didn't affect them, why would they care?

Yes. People are tight, they don't like being charged a fiver if they can help it. Thing is, people who are good at managing their money will always be good at it and those who aren't will never be - for that reason, I don't think the number of people going overdrawn would really go up.

But would a fiver be as serious to someone as forty quid? Or would the response be "ah, just go overdrawn - it's only a fiver". The whole point of the extortionate fees is to scare people into not breaking the rules.

No it's not, it's to earn the banks as much money as they can possibly squeeze out of their customers.

The difference is that the banks are (or were, until recently) a private business which are there to make money. The government are a public service elected by us and not really there to make a profit.

I understand that, but the banks still do make mega bucks and still would make a profit if they charged £5 for people going over their overdraft. They are out to cream the consumer for everything they can.

I don't know much about postage, but I'm pretty sure that any discounts available to the banks will be available to anyone else doing bulk postage.

I'm not disputing that, my point was to illustrate how much the banks would still make from a person going overdrawn even if they charged £5 for it.

The fact is, they wouldn't make as much money, although I still reckon they would profit - if they did (and the only way that could happen is if more people, as you have suggested, went over their overdraft limit), they'd be doing it.

As I said earlier - the charges are one of the ways the banks make money. If it suddenly becomes a lot less profitable, they will want to make the money through other means. The reason the charges were so high was because it was a way of preventing people from breaking whatever rules they had agreed to when they opened the account. The banks attitude will be "fine, no more charges - everyone needs to pay £30 a year for their account, oh, and £1 a day for going overdrawn. Is that fairer for you?".

£30 a year I wouldn't argue with; £1 a day for being overdrawn I would.

As I said above though, if more people went over their overdraft if the banks charged £5 for doing it, why would it be less profitable?

I do kinda agree with what you are saying, the two points are that firstly the banks need to make a profit from current accounts. Up till now, they have been doing it with charging customers who have broken the terms of their contract with the bank. If they are not allowed to do that then they need to make money elsewhere and that means I need to pay more than I am now, therefore I don't want that to happen.

The other point is that there needs to be an enforcable way of stopping people breaking the terms of their agreement. A massive charge is a pretty good way to enforce that. Making the charges significantly less is not going to be as effective so more people will spend money they don't have and worry less about it.