Thoughts On Bank Overdraft Charges
So bank customers hoping to be refunded overdraft charges were dealt a blow by the Supreme Court this week when it overturned earlier court rulings that allowed the Office of Fair Trading to investigate the fairness of charges for unauthorised overdrafts. Many people and campaigners are upset as a result but I actually think it was the correct decision.
I'm not going to defend the banks for their recent actions that have made bail-out's necessary and brought our economies to the brink of depression. I can certainly understand and appreciate the anger and hostility towards banks over that because I share it. However on this subject I think charges are right to be made and there are two key reasons, which are closely linked, as to why I say that. Firstly, if you correctly manage your finances you're not going to be charged. These charges are made for unauthorised borrowing on your account. Why should you expect that such borrowing be given to you for free? This is part of a bigger problem unfortunately that got us to this point in the first place. Credit was so cheap for so long people seem to think they can just spend above their means and worry about paying later. Spend only what you have and you'll receive no charges. If you're struggling financially then meet with your bank to discuss an authorised facility or to restructure your debts. The second reason why I'm for unauthorised lending charges is because banks are businesses at the end of the day. If it gets ruled that they cannot make these charges to people who are using their accounts irresponsibly then what do you think that will that mean for us that are? I'll tell you what it will mean. It'll mean current account charges being reintroduced so we'll all be paying for the irresponsibility of the few. I'm sure most people won't want that either. ~ SirFFW
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