Switch banks – it’s the only way to show them you mean business


Switch banks – it’s the only way to show them you mean business

A report today in the personal finance section of the Mirror says bank customers need to get tough with their banks. The banks are apparently up to their old money making games and traps.

Report by Phillips Media produced at Mirror.co.uk

Banks are literally laughing all the way to the er… bank.

They’re back to their old tricks, raking in vast profits by flogging over-priced products while providing shoddy service. And it appears they couldn’t care less about customers.

Record numbers of complaints to the Financial Ombudsman Service – a whopping 84,000 in the past six months alone – show they just can’t be bothered.

Lloyds TSB, Britain’s biggest bank and the one that’s 40% owned by taxpayers, is the worst offender. It tops the list of complaints with a hefty 12,750, compared with Barclays with 7,991 and HSBC with 3,286. It also continues to make above-normal profit margins – expected to be around 27% this year, compared with 7.5% in 2009 – on the products it offers. Banks rely on our apathy, hoping we’ll just accept it when they ignore or simply say no to reimbursing us when things go wrong.

The FOS complaint figures are just the tip of the iceberg, as many thousands of customers simply let things go.

Who can blame the banks for getting away with what they can? Just a pathetic 6% of us have switched current accounts to show them that we won’t put up with unfair treatment. Many people don’t switch because they think it will be complicated, things may go wrong and they’ll end up out of pocket. The opposite is true, as reader Sharon Boon found out last week when she finally decided she’d had enough of Lloyds TSB and switched to Santander.

“I was fuming when, after 20 years of being a loyal customer and never going overdrawn, Lloyds whacked a £33 charge on my account for going £9.17 overdrawn,” says the mum from East Grinstead in West Sussex.

“I haven’t got an overdraft facility so why did they let me go overdrawn and then charge me way over the odds?

“I check my account of online regularly – they’ve changed the look and I thought I was in credit and couldn’t spot where I’d gone overdrawn.

“I know I’m not their best customer at the moment as I gave up my full-time job to look after my daughter Francesca and to start Flowerbug, my flower business, and haven’t earned much money from it yet.

“I didn’t get anything in writing informing me about this charge and when I called to find out what it was all about they told me they had sent me a letter and then accusingly told me they hadn’t because I’d signed up to have no paperwork. Everything is on the bank’s terms. They don’t care about loyalty and as soon as you’re not paying in vast sums they don’t want to know you.

“I’d advise anyone not happy with their bank to switch. Everything is done for you. All you have to do is decide who you’d rather bank with.”

Lloyds says: “We have listened to our customers which is why, from December, our overdraft charging structure will change. All customers will have a £10 buffer which means should they go overdrawn by £9.17 like your reader, they would not receive any charges or interest.

“We’re sorry Sharon has decided to leave Lloyds and hope she may consider the bank again in the future.”


1 Decide which bank you want to switch to.

2 Banks have switching services and will handle the move for you.

3 Your old bank has three working days to provide the new bank with details of your standing orders and direct debits.

4 Your new bank has 10 working days to open an account once your application is approved.

5 Remember to give your new bank details to your employer, pension provider etc.

6 If any bank charges are incurred as a result of a mistake or delay by either your new or old bank, they will cancel the charges.

The firm advice from MONEY at the Mirror is we need to vote with our feet and switch banks when we’re not happy with the way they treat us. That is the only way to force them to behave fairly and offer decent customer service.

Taking a complaint about a bank to the Financial Ombudsman Service really should be a very last resort. The FOS should be coming back and saying “Sorry, nothing we can do – your bank has acted fairly” rather than upholding almost half of complaints in favour of consumers. We get the banks we deserve if we continue to allow them to get away with behaving badly.