Do I really need an overdraft?
Many people in the UK will have access to "interest-free" overdrafts for which they may be charged a small administration fee on a monthly basis. However, do we really need an overdraft or is it simply a long-term extension of our own credit facilities?
The ideal of an overdraft should simply be access to emergency credit at very short notice. However, it can be very easy to fall into the trap of accumulating your overdraft facility with your income on a monthly basis to arrive at "accessible credit limits". This can often lead to situations where we fall into our overdraft facility earlier and earlier each month which can often lead to extended overdraft facilities which are often more expensive and attract higher interest rates.
Even an interest-free overdraft facility, although often very useful at the time, can be the first step towards more debt and more charges in the future. We all need to be vigilant and keep within our budgets and not automatically assume that our overdraft facilities are part of our "everyday budget". It is easy to suggest that a £100 overdraft is simple to pay back but this could become £200, £300, etc and the situation can easily get out of control.
Record complaints about UK banks
The financial ombudsman has today issued a report which casts a very large shadow across the UK banking sector with record complaints recorded over the last 12 months. Without doubt, the UK banking sector is by far and away the more guilty of financial companies in the UK with regards to perceived mistreatment of customers.
The report reveals that almost 60% of complaints about curr...
Are packaged bank accounts really worth it?
As many elements of "free banking" start to disappear from the UK financial scene there are concerns that some packaged bank accounts are not worth the extra money. The vast majority of UK banks offer a service which, for a small payment per month, will give the customer access to a range of insurance policies and other services at "at no extra cost". These include amongst others, travel insurance...Read More
Unclaimed funds to go to community use
Funds lying dormant in bank accounts and building societies could be used for community purposes under new plans being considered by the government.It is estimated that up to £400 million is currently lying in accounts which have been untouched for more than 15 years, with the chancellor, Gordon Brown, looking at plans to enable the government to reclaim the money.A consultation on the issue is s...Read More
Bankrupts unable to open bank accounts
As the number of bankrupts in the UK continues to grow there is concern that many banking operations in the UK are preventing the opening of very simple and non-credit-based bank accounts. There is no legal reason why a bankrupt should not be able to have access to simple banking operations with no credit and no overdraft facilities are available. So why are UK banks doing this? From a banking...Read More
Could UK banking reforms backfire on consumers?
The influential Treasury Select committee has today reiterated its call for a radical reform of the UK banking system to prevent similar bailouts in the future. This comes despite the fact that the credit crunch, which eventually led to the worldwide recession, is an event which has only happened on a similar scale once in the last 100 years. There are also concerns that moves to reform the UK ban...Read More