HBOS getting ready to roll out reward charges across all accounts ?

[EXC]

Originally Posted by enaid

They can say they are reducing charges till the cows come home, but I for one will not be convinced until the NEW REDUCED CHARGES have been put into effect for at least a couple of months and then see just what they are costing the consumer.

Looks like you were right. You're a wise old owl Nelly.


http://www.mirror.co.uk/news/city-ne...5875-21699500/




Halifax overdraft charges to rocket



By Clinton Manning 25/09/2009

A million Halifax customers will see their overdraft charges rocket when sneaky fees come in just weeks before Christmas.

Earlier this week, the bank boasted it was slashing the penalties for customers who go into the red without permission.

But an investigation by Your Money reveals the Halifax, which was bailed out by taxpayers, will claw back most of that cash by stinging sensible customers who have set up agreed overdrafts.

From December 6, they will be hit with a £1-a-day charge - up to 20 times as much as they're paying today.

At present Halifax and Bank of Scotland charges people 19.5% interest if they go into the red. That sounds a lot when the Bank of England base rate is at an all-time low of 0.5%. But it means someone with the average overdraft of £900 would pay £14.42 if they remained in the red for a month at that level. But that would more than double to £31 from December.

For people with smaller overdrafts the increase is even harsher, especially if they only go into the red for a few days. Someone going £100 overdrawn for a day would be charged just 5p today but that will soar 20-fold to £1 in December. Halifax has around three million customers on its standard current account but claims about two thirds never use the overdraft they have arranged.

The bank claims it is responding to customers by introducing a simpler system of charges which is easy to understand.

It stresses the fact that people who go into the red without permission will pay £5 a day instead of £28 plus 19.5% interest today.

A spokesman pointed out that customers who switched to a Halifax Reward Account received £5 a month credit, enough to wipe out five days' authorised overdraft charges.

But this only applies to customers who pay in at least £1,000 each month.
The spokesman said customers would need to keep an average balance of £75,000 in their account to receive £5 a month interest. But this is because the bank's standard current account currently pays a paltry 0.1% interest.
Halifax will write to customers detailing the changes in the next few weeks.


We say...

Halifax is using smoke and mirrors to try to disguise bad news.

By trumpeting cuts in fees for unauthorised overdrafts it clearly hoped to draw attention away from the hikes facing other customers. Sadly this could be the shape of things to come.

Halifax clearly believes the banks will lose the ongoing legal battle and be forced to slash sky-high penalties imposed on people who overdraw without permission.

If that happens other banks are likely to follow Halifax and look for ways to claw back that lost revenue.

[Amethyst]

That may be why there is the holdup rolling it out to all customers - the FSA say you can't change terms without consulting them and showing evidence that it doesnt negatively impact consumers. So putting it on a new account which 500,000 people now have should give the FSA a lot more to look at to see if it is better or worse.

[natweststaffmember]

"All the current accounts are going to have the same structure as the reward account.
Which means there is no more £35.00 or £28.00 charges for paid items and being overdrawn. It will be £1 a day for using the overdraft of £2'500 or less and £2 a day for more than that. Plus £5 a day fee if customers go overdrawn. The Reward account has a text message service to alert customers if they went overdrawn as well

There going to bring back the basic Current account for customers, who do not pay into the account more than £1000.00 a month so will not receive £5.00 reward.

The High interest account will close to be and accounts will be changed to the current account.

The Ultimate reward account will change it still will be £12.50 a month to this to so the first £300 of the overdraft facility will be free and customers would have to start paying the £1 or £2 a day fee's once they go over that and if £1000.00 goes in they will also receive the £5 a month so potentially means the account is £7.50 a month.

The Easycash and Cardcash account for an unpaid item fee will be £15.00, 29.8% unarranged debit interest if overdrawn

The Student account: no change there so unpaid items £20.00 and £28.00 for being overdrawn,24.25% unarranged debit interest if overdrawn.

So some customers are going to be better off with this new system, but there is going to be some that will not be as well, especially the ones who possibly live in there overdrafts but have never received charges but have to pay £30 a month arranged overdraft fees.

These account changes on the 6th December customers will receive statements on 2nd January 2010 what the fees are going to be for the month of December then debited on the 31st January 2010."

This kinda confirms most of what we know but was kindly passed onto me by a member of HBOS staff. There is a little bit of spin with it but you can see how the Ultimate Reward is marketed.

[natweststaffmember]

Halifax/ Bank of Scotland: a guide to account changes. - MoneySavingExpert.com Forums
Info only and please feel free to expand

[natweststaffmember]

Banks penalise those who play by the rules - Times Online

Nice bit of journalism apart from the last paragraph

"Banks have been under pressure to cut overdraft fees ahead of a Supreme Court decision on whether the charges are fair. In a separate initiative, the Office of Fair Trading said last week that banks had agreed to make charges clearer. Unauthorised charges have dropped from 19.8% to 18.96% since April, while agreed rates have increased from 12.84% to 13.08%."


They aren't deciding the fairness of bank charges only the assessability of charge for fairness.

[Amethyst]

BBC - Douglas Fraser's Ledger: Interesting interest rates

nice article about lloyds new charges and interest rates 36,400% pa on £1 or14.6%pa on £2400 ?

[natweststaffmember]

http://www.lloydsbankinggroup.com/me..._structure.pdf
The "Official" press release from Halifax. see pages 2 as to how it affects you.

[Amethyst]

All the cuffuffle over these charges, they arent new just being rolled across all current accounts - wonder how many of the 500k account holders that opened accounts with h'fax since February and thus have been under this new scale of charges have complained ?

[Amethyst]

Foulkes leads fight against bank charges




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Published Date: 05 November 2009
LOTHIANS Labour MSP George Foulkes today stepped up the campaign against Halifax Bank of Scotland's new overdraft charges, which he claims will hit thousands of Scots in the pocket.

From next month, HBOS will charge customers a flat £1 fee for every day they are overdrawn up to £2,500 instead of the current percentage-based charges.

Lord Foulkes has written to Consumer Affairs Minister Kevin Brennan, asking the UK Government to challenge the changes.

He has also written to the Financial Services Authority, the Office of Fair Trading and Lloyds Banking Group.

He said: "This new fee structure is outrageous and likely to cause great hardship to thousands of people already in dire straits.

"For many people who live in their overdraft for the best part of their financial month, this is a real blow. Their overdraft gives them the leeway to concentrate on clearing some more serious debts."

[natweststaffmember]

On issue of refunds:

"They will usually refund the first £35.00 of the new charges as your 'first refund under the new structure' if you ask. This is of course assuming you're a good customer and did not get regular charges prior to the change.

Halifax are aiming to attract customers who stay in credit more often than not. For people who do stay in credit, this is a very good account, though for those who are constantly overdrawn, it's VERY bad. "

[catinahat]

re. these charges; is this intended to be a charge applied to ALL overdrawn customers, whether or not it is an 'authorised' or 'unauthorised' OD? Only reason I ask is because Smile (co-op internet bank) were charging a DAILY rate of £4.00 per day for unauthorised OD's which would appear on statement as ' inauth OD daily charge...' it makes HBOS mere £1 (tongue in cheek;-) seem cheap at quarter the price! ho-hum.....;-) CatX

From next month, HBOS will charge customers a flat £1 fee for every day they are overdrawn up to £2,500 instead of the current percentage-based charges.

[natweststaffmember]

HBOS are charging ALL accounts(unauthorised and authorised) and although they have said in the press that if you only use £10.00 they wouldn't charges, one poster on MSE has already said that they were charged in that scenario.