Business Bank Charges

Abbey Business banking would be free for you I would guess.

My Ltd. company usually has only around 10k sitting in the current account (it varies quite a bit), I probably write rather fewer cheques than you, probably only ten or so per month, but there are quite a few electronic transactions as well. The Abbey have just paid me interest (not a lot but better than nothing) on my balance and no charges at all.

Without doubt, change bank.

Can I ask one question here. Would you work for one of your clients free of charge. What if they threaten to take their business elswhere? I know the answer - of course you would not work for free but you expect the bank to do so. Your bank charges are tax deductable. By all means change banks if you so desire but why should they work for no return? If you have so much sitting doing nothing ask about a sweep facility to a business savings account or put some of it on call with their treasury division.

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Don't be dumb, banks make big profits from business accounts because they are not regulated as strictly as personal accounts.

1/ If a bank can operate an individuals personal account for free and make a profit then why should a business pay more. 2/ You don't need to worry on behalf of your bank. They are more than capable of looking after themselves.

Your loyalty towards your bank is admirable but rest assured it is misplaced.

In message , Adrian Smith writes

??? Who?

Balderdash. The two are priced completely differently because they operate in different markets.

Eh? Where on earth did you get that idea? How can bank make any profit merely by operating a free personal account?

Come on, you are calling Eric 'dumb', so perhaps you can explain how bank makes money merely on a free current account?

It is only done so as to acquire the client and then obtain profitable collateral business. Its a loss leader. Isnt that obvious?

A business doesnt pay 'more', it pays for what it gets.

Hmmm, I dont understand the relevance of this. Sour grapes or jealousy perhaps?

Ahh! A man of knowledge! (sadly not).

Why would any other bank offer you services if it did not get paid for it?

Hey it's not my company that's sitting on this cash. That does seem wasteful.

However it is the responsibility of the bank to both remain competitive and profitable.

My responsibility is to ensure that my own business is competitive and profitable.

Apologies for calling you dumb.... I'm sure your not dumb at all :-)

Adrian.

You don't get it John.

Far from being 'sour grapes' or 'jealousy' it's simply not my responsibility to worry (or even care) that the bank makes a profit.

In message , Adrian Smith writes

So why did you make the post to which I responded? And why did you make such incorrect assertions?

My original post simply advised the OP to change banks. One of the big problems with the UK banking system is that not enough people change banks when they feel they have received a raw deal.

I stand by my assertions in my following mail and challenge you to show otherwise, without splitting hairs and being petty.

Apart from me calling Eric dumb of course which I freely admit was me being dumb:-)

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Hedge your bet - buy shares in the bank[0] - I'd have done a *lot* better out of $BANK if I'd done that in ~1995-2005, rather than just have a mortgage & TESSA/deposit a/c with them.

ISTR the suggestion, many years ago, that one should buy BL cars, as the taxpayer had /already/ underwritten them by 500 quid a go - OK that's a bit silly, but you get my drift...

rgds, Alan [0] 'course if you've got any index-tracking PEP/ISA/Pension stuff, then that's ~35% banks anyway.

In message , Adrian Smith writes

I agree with that, the banks rely on customer inertia.

I am giving facts and you are expressing an opinion. My facts have been derived from a very considerable period working in a bank. I really do think the 'loss leading' aspect of free personal banking is common knowledge and I would be interesting to know how a bank can possibly make money when the average credit balances are relatively small.

As an example, a typical employed individual on the average salary which is paid in to his account, and if the persons spending pattern is typical, i.e. most pre-authorised payments scheduled for the beginning of the salary month, then a typical average balance is about £600. Banks internal accounting give this value at base rate, but lets assume it is lent on at 6.5%, this means the account has to cost less than £39 per annum before the bank makes any money. The trouble is it costs more than that.

I dont do that!

Fair enough. That did annoy me and inspired the tone of my original reply.

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