Bank Charges

In message , Roland Watson writes

What happened, did they bounce a cheque or a payment of some sort?

No, not necessarily.

Every day I get a list of my customers in excess and have to decide what to do. I can return, pay, transfer funds, increase lending limits if they are available, or in exceptional circumstances, contact the customer and ask them what the foxtrot they think they are doing!

Given that it takes me about one hour to do this on a daily basis, and the cost of my time can be approximated at about £20 per hour, the cost of the IT infrastructure probably runs into the hundreds of millions, factor in the associated costs in risk analysis, not to mention the stationary & postage costs, the cost of the machinery necessary to effect the writing, franking and signing of the said correspondence and I think you will conclude that the charge is valid!

Your average retail bank staff will say "oh the computer did it" - but this just reveals their ignorance of the back office ops undertaken centrally. There ARE humans looking at it - it is just that you will NEVER get to know who or where they are, nor what factors caused them to make the decision to pay/return. There are computer models providing guidance - ie System says return - but it can be overridden. MC

They refused a direct debit due to insufficient funds.

I get the impression that no decision or analysis was involved. I transgressed, the charge was debited and a standard letter was sent out. I doubt my bank does any decision making on an individual instance unless the person writes to them or it is unusual (i.e. large amounts, repeat offender, ...).

I don't doubt you have to make decisions and perform analysis, but I also doubt that your wages are solely funded by bank charges!

Thanks,

Roland.

Every day I get a list of my customers in excess and have to decide what to do. I can return, pay, transfer funds, increase lending limits if they are available, or in exceptional circumstances, contact the customer and ask them what the foxtrot they think they are doing!

Given that it takes me about one hour to do this on a daily basis, and the cost of my time can be approximated at about 20 per hour, the cost of the IT infrastructure probably runs into the hundreds of millions, factor in the associated costs in risk analysis, not to mention the stationary & postage costs, the cost of the machinery necessary to effect the writing, franking and signing of the said correspondence and I think you will conclude that the charge is valid!

Your average retail bank staff will say "oh the computer did it" - but this just reveals their ignorance of the back office ops undertaken centrally. There ARE humans looking at it - it is just that you will NEVER get to know who or where they are, nor what factors caused them to make the decision to pay/return. There are computer models providing guidance - ie System says return - but it can be overridden. MC

John.

The Halifax. I guess they need to recoup their high interest current account costs some way!

In message , Roland Watson writes

Well that takes quite a lot of human intervention. It needs a human to decide whether to pay it or bounce it (which isn't as cut and dried as it seems), and correspondence between your bank and the originators bank and some manual transactions as well. Hence the charge.

In message , Roland Watson writes

In support of MC, I think you dont know how banks work, human intervention and decisions are required before an item is returned unpaid.

As it happens Banks aim to recover ALL of their direct costs (including salaries etc.,) from charges (but isn't usually successful in this) with the net interest received (after paying out the credit interest) being pure profit.

But how come the Bank allows its charges to be paid? :)

Since I suspect a lot of bank charges are extracted from people in financial difficulties, that doesn't say much for banks.

I'll send them a few more letters, I suspect they won't charge me 35 for processing each letter...

Roland.

Would you, if you ran a business, in dealing with a customer whose actions cause you unnecessary costs say:

"well, they must be in financial difficulty, so I will accept the loss to me....."

Try saying that to the plumber who comes at a pre-arranged time to fix your boiler with you having pissed off to Sainsburys for the weekly shop!

Banks are businesses, not charities.

MC