Two thirds of customers slapped with excessive overdraft charges have yet to come forward and reclaim their hard-earned cash, as banks’ bullying techniques appear to be working.
A massive 64% of people surveyed by consumer pressure group Which? had remained silent despite the fact 85% of those who had come forward had been partially or fully refunded.
Which? added that figure would be nearer 100% if people persisted when their bank didn’t immediately reimburse them, instead of giving up.
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Banks are exploiting the fear factor
What is astounding is the fact that one-in-five people yet to claim cited fear of how their bank would react as the reason they hadn’t asked for their money back. Banks know well that the average person on the street finds finances intimidating. By combining that with some heavy-handed techniques like terminating accounts of those who query and being generally unresponsive, they are keeping hold of millions of our money!
“It is terrible how poorly some banks have been treating some customers,” said Which? personal finance campaigner Emma Bandey. “It is bad enough that they have been levying unfair charges for all this time, but the response from some banks shows that they need to work on their customer service.
‘Banks need to get their act together and deal with this problem. Rather than using stalling tactics. It can’t be good for the banks’ image that so many people found them less than helpful.’
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Don’t give in to bullying tactics
Despite what your bank would like you to believe, claiming back unfair charges is a simple process that won’t take up hours of your time - so far the banks have chosen to settle all cases referred to FOS.
And if your bank does not co-operate, refer the case to the Financial Ombudsman Service (FOS). Anyone who thinks they have been unfairly charged by their bank for going overdrawn in the last six years can visit the Which?
bank charges site, that includes a guide to reclaiming and downloadable template letters to send to your bank.
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Banks are making a killing through these unfair practices
Which? estimates that Britons paid £4.7bn in unauthorised overdraft fees and interest charges in 2006 alone.
The
Consumer Action Group claims that banks make profits from their penalties in the order of 2000%, while 1-in-5 bank customers are victims of unlawful penalties.
“We have evidence that the Yorkshire and Clydesdale Banks costs of handling delinquent accounts are a maximum of £2 per time and normally very much less… and senior personnel within Barclays admitted the same thing. “It is inconceivable that the other UK banks are any different,” the group claims on its site.
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The bank charges issue will impact all bank customers
The actual amount paid out by the banks is likely going to be a drop in the ocean compared to how much they are going to lose now that this revenue stream has closed.
And so banks, being ruthless money making machines, have already embarked on new ways to bleed more money out of you. Keep an eye out for these new charges when choosing an account:
-Rising balance transfer fees of up to 3%
-Higher rates for withdrawing money at an ATM
-Requiring that a minimum amount be spent to qualify for 0% interest rate deals
-Higher charges for using a card abroad.
Of course all of this comes on the backdrop of record profits for a number of the country’s largest banks. So with all this in mind, make sure you are getting the maximum benefit from your bank accounts, as they are certainly doing the same to us.
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