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Originally Posted by Gareth
Just a minor point... the banks involved have not won a single court case but neither have they lost a single court case. They've all been settled out of court with the banks repaying the fees (which is more cost efficient for them to do, as the individual amounts are relatively small, albeit numerous), and of course no admission of guilt has ever been announced by any of the banks concerned.
Of course the banks are going to drag their feet before coughing-up... that's to be expected really.
The OFT finding wasn't that charges per-se are unlawful, but they did find that the charges were excessive. The OFT's suggested limit is £12, they have never said that all charges are illegal or should be discontinued. Their press release can be read here
I much prefer the current system, to be honest. I don't see why I and many, many others should be penalised because, unlike some people, we can manage a bank account properly. However, if things continue, then I can see blanket charges being introduced. I don't agree that it's a case of the poor subsidising the rich, as I know many not-rich people that benefit from free banking.
---------- Post added at 12:26 ---------- Previous post was at 12:22 ----------
Another thing... regarding ATM charges, would you expect the nominal charge to be paid to the owner of the machine you're using, or should it be paid to your bank even if you're not using your issuing bank's ATM. |
You thinking about it wrong the only reason why your banking is free is because of the penalty fees that are been charged which are excessive, incidently they said £12 is still too high but was only set since it didn tneed lengthly legislation, a actual reasonable charge is what it cost them to send the letter and block the payments. So penalty fees stay but they are nominal amounts just to cover banks costs and maybe a small profit so lets say £3 instead of £30. The people who make mistakes still get penaliased as you say they should but suddenly they are not subsidising your free banking. Please tell me whats constructive about charging someone in financial trouble keeping them in a loop that keeps them over their overdraft limit, what use is it a bank telling someone to pay £60 into their bank account to rectify situation when they only have £30 and that £30 of that £60 is a charge from the bank.
Of course they havent actually lost a court case, but settling out of court means they are admitting they wrong, it may mean publically they are avoiding embarrasment but by settling we know they know they couldnt win a court case.
OFT didnt need to find the charges unlawful they already illegal from the "Unfair Terms in Consumer Contracts Regulations 1999".
For ATMs yes owner of ATM collect fee, you notice currently ATMs at shops are usually charged and ones at banks are free, supermarket ones are usually free but I believe the banks maintain them. So the banks would then get paid for ones used at their premises.