Banks, Overdraft Charges, and Sanity

I’m sure I’m not the only person to actually be quite pleased that the banks won their case about overdraft charges this week – but it’s pretty hard to find anyone else who’s actually willing to say so. If the case had been lost by the banks, it would likely have ended up meaning that everyone had to pay a fee for having a bank account – and thus the people in credit subsidising those who weren’t.

I do, however, think that the banks take the piss on just how much they charge for going over the overdraft limit and so on. Fine, a fiscal penalty makes sense – but £30 per refused item? £15 for going over the limit? That’s a pisstake right there.

I can see the point of some of the people who were (rightly, in my opinion) furious with the banks for charging £30+ when they went 50p over their limit. That’s a punishment that’s out of proportion with the “crime”. As with many of these things, I would like to see some fuzzy limits in place, rather than rigid “10p over and you’re fined” limits. For example, if someone goes a couple of pounds past their limit – and these accidents can and do happen, it doesn’t take much for an unexpected item to drive you close to (or over) that limit on occasion – then they shouldn’t be charged. That policy shouldn’t be publicised as such, but would (again, in my opinion) help provide a far better response from customers.

Yes, you will always get the people who take the piss out of a system like that. But if you’re going to have that bit of fuzz round the edge of the limit, it’s more likely to benefit than hinder. If I’d gone (for example) £3 over my overdraft limit, I’d probably take far more note of not being charged than of being charged. It might make me think “Blimey, that’s reasonable” – or even just “Ah, they’ve fucked up and not noticed” – but at least I wouldn’t be getting pissed off with the bank and ranting about it to all and sundry.

If you go tens (or hundreds, or thousands) of pounds past your agreed overdraft though, then you should expect to pay. I don’t have an issue with the fact that people are charged extra when they’ve done that. That’s just business on the part of the banks. And if someone’s so stupid they don’t read the terms and conditions, or think they won’t get charged, then (as always, in my opinion) then they’re not really fit to have a bank account in the first place. Take some fucking responsibility for your actions.

This year, as I’ve said before, hasn’t been a great one for me, workwise. I did end up over my overdraft for a while, and I did get charged for it. Things are back to normal now, and I’m back in credit. But I didn’t object to the charges (other than their extortionate levels) because I’d got myself in that position – one could argue that fate and shit luck had a part to play, but that’s by the by – and I knew I’d get charged.  The only part that rankled was that I’d tried hard to fix things and extend that overdraft limit well before the situation arose, but fell foul of long-standing problems with my bank that I keep on being assured have been fixed, only to be bitten on the arse by them again and again.  So I’d tried to organise a fix, but hadn’t been able to do so. If I had been able to, I’d have been fine – I never went past the extra amount I tried to set up. Even so, I knew I’d get charged for going over that limit.

But never once have I been tempted to think “I’ll try and get a refund on all my bank charges over the last ten years” or whatever. When I’ve been charged (and it hasn’t happened often) it’s been because I’ve fucked up, or been in the shit. Or both. I’ve always known (roughly) what those charges would be, and they’ve been expected.

I don’t know why people think they can get their overdrafts “for free”, without being charged by a bank to borrow that money. Banks are in the business of lending money – they’re not (and never will) do it for free. And if you think they will, then I’m sorry, but you’re a fucking idiot.

So yes, I’m pleased that the banks won the case. I think that for once it’s actually the correct result.