Christmas borrowers: have a plan for payback

With Christmas nearly upon us, keeping the costs down to a reasonable level is an important part of enjoying the festive season in a way that won’t lead to worry and anxiety in the New Year. If anyone’s plan involves borrowing to meet the costs of Christmas, it’s important they first figure out a realistic repayment plan.

So says Think Money, which has issued a warning for people who are thinking of borrowing to help them meet the costs of Christmas.

It advises them to plan their finances out carefully before they actually borrow any more. Without a good repayment plan in place, they’re running the risk that they won’t be able to repay it as quickly as planned (or, potentially, at all).

As you might expect, this could lead to all kinds of problems, from higher-than-expected interest costs to late payment charges. Depending on the individual’s situation, it could even lead to more serious consequences, such as a CCJ (County Court Judgment).

“[…] some people might be making a New Year’s resolution to get their finances in order,” a spokesperson for the financial services company commented.

“For some, that might involve taking out a debt consolidation loan to simplify their finances and set out a clear plan for repaying their debts. This can be a good way of managing debt, but borrowers still need to make sure their repayments fit in with the rest of their budget.”

Tags: court, year, repayment, anxiety, level, Christmas borrowers, New Year, County Court Judgment

Lack of consumer confidence continues with High Street banking giants

For the last few years the leading High Street banks in the UK have taken a real battering in terms of consumer satisfaction and confidence levels, with many people losing faith in the biggest banks, including those that have had to be bailed out by taxpayers. A recent survey has shown that lack of confidence and satisfaction with the big High street banks continues, despite their general market dominance.

The survey was carried out by the consumer campaign group, Which?. As part of the process twenty eight banks and building societies were analysed in terms of their customer satisfaction levels. All main services were looked at when assessing customer satisfaction levels, including current accounts, savings accounts, credit cards and mortgages. This comes after it was revealed that in the first half of this year the Financial Ombudsman Service received around 54 percent more complaints about financial institutions compared to the final half of last year.

When it came to customer satisfaction levels amongst financial institutions none of the leading High Street banks even managed to make the top fifteen. In fact, the results showed that the four banks that had the highest levels of customer satisfaction when it came to current accounts controlled only 6 percent of the current account market whereas the four banks that had the lowest levels of customer satisfaction with current accounts controlled 38 percent of the current account market.

An official from Which? said: “The high street is dominated by banks that have a shocking record for customer satisfaction – what more proof do we need that the market isn’t working? We will only have a truly competitive market when banks are made to face up to a simple choice – either look after your customers or be prepared to lose them.”

Tags: Current account, consumer satisfaction, general market dominance, consumer confidence, none, satisfaction, shocking record, year

Over half of Brits hope to see base rate increase

When the Bank of England originally announced that the base interest rate in the UK was being dropped to an all time low of just 0.5 percent thirty months ago, there were many people who were ecstatic as a result of being able to save money on their outgoings and borrowing in what had become a very difficult financial and economic climate.

However, thirty months on the base rate is still at this record low and whilst the economic and financial climate is still difficult a rising number of people are now starting to hope that the base rate will soon start to increase again. Whilst many borrowers have indeed benefitted from the low base rate there are also many that have suffered, such as savers who have lost a fortune in interest on their savings and consumers who have seen inflation soar.

A recent survey has revealed that more than half of UK consumers are now hoping that the base interest rate in the UK will increase for one of a number of reasons. In total, 52 percent of consumers are hoping to see the base interest rate increase. Of these, 41 percent wanted the base rate to rise so that they would be able to get better returns on their savings, which have really suffered over recent year. A further 11 percent said that they would like to see the base rate rise in order to tackle soaring inflation.

One industry expert stated: “With the Bank of England Base Rate sitting at a record low for the past two and a half years it is clear that there have been winners and losers, with savers generally feeling the combined impact of low rates and high inflation. Some borrowers have benefited, particularly those mortgage borrowers with large deposits, or those who want to borrower larger amounts on personal loans.”

Tags: increase, interest rate, low rates, recent survey, winners and losers, combined impact, uk consumers

Direct Marketing Helps to Optimise Savings Offers within a World of Debt Culture

In these testing times, it can be difficult for marketers to put the finance into a targeted advertising campaign but direct marketing has been proven to actually save money and increase conversions by targeting the relevant people with money saving deals.

Carpet bombing the web with generic banner ads and hoping for the best, may be a tempting tactic to opt for if a business is pushed for time and finances.  However, advertisers choosing to utilise the internet’s direct marketing potential are benefitting from what is a surprisingly easy campaign to set up.

Any business that has a customer database or even a subscription requirement on their site already has a wealth of demographic data at their fingertips.   Choosing to use it is simply the next step into direct marketing.

Websites offering money saving deals are reaping the benefits of this marketing strategy because of the niche angle that comes with it.  The customer analysis they’ve gained from their collated data of previous sales gives them a heads-up on customer spending habits, interests and approximate budgets.

With those factors in mind, they can direct specific offers towards customers who are more likely to respond to such deals.  More impressively, they could use the data to target customers who can afford these types of offers – eliminating the amount of wasted ad space on the screens of uninterested customers, who typically don’t spend their money in that advertised area.

There’s a fine line between prejudging customers and using their demographic profile to offer them certain deals or not.  When used correctly, marketers can divide their audience into segments and select which service/product they have available should be advertised to which target group.

Conversion rates on targeted ads are much higher because of this and although it may seem unfair to ‘group’ people into categories, the offers from a business are still available to everybody and are often advertised more generically through other mediums (TV, Radio, etc).

By assigning ads to each demographic group, direct marketers are personalising the user’s internet experience and can even influence the ads on the side of their Facebook page.

The concept behind Facebook advertising is pretty much the same as all other forms of direct marketing, except the process is operated entirely within the Facebook world of tagging, likes and groups.

For example, if a Facebook account holder ‘likes’ a group titled ‘Yes! The football season is back’, digital TV services like SKY could advertise their sports channel packages in the right sidebar of that user’s News Feed page.  Similarly, leisure centres could advertise to that presumed ‘sporty’ user too.

It’s a remarkable method of building a customer analysis and by actively using these social networking sites, businesses also have the opportunity to interact with thousands of customers via live forum feeds, which could be seen as an even more direct approach to direct marketing.

The operation requires a little bit of human input but considering the data is probably already available to businesses because of the demographic data they have previously collected, half the battle is over before the campaign has even begun.

In a world of debt, recession and possible depression – direct marketing exclusively alerts people to money saving deals who appreciate them most.  At the same time, the technique has the potential to eradicate the annoying online adverts that have no relevancy to user’s individual interests.  Not to mention the spamming generation pending doom because of this smarter advertising method.

The internet is set to be a happier and more sophisticated place because of direct marketing and is such a gift to marketers in need of more accurate email lists to distribute their electronic ads.

The social networking side of the approach is an added bonus too and a wasted gem by web-ignorant companies.  In today’s world, deal making businesses need an online presence and direct marketing can deliver that, with little cost and minimum groundwork.

Tags: business, social networking, direct marketing potential, Business Finance, demographic, targeted advertising, Facebook advertising

Debt conscious Brits opt for staycations

According to a recent report a rising number of people in the UK who are conscious about falling into debt and want to avoid the pitfalls of any further debt are now opting for staycations when it comes to holidays, as they believe that this will be the cheapest option for them in the current climate. Nearly one in four Brits stated in a recent survey that they would be trying to spend less on their holiday this year.

For many people, going abroad on holiday has become increasingly difficult as a result of their financial situations. Many have found that the cost of flights and accommodation have become too much for them to manage on their more limited budgets, and those with families are finding it increasingly difficult to afford to take the whole family on an overseas holiday, as this can run into many hundreds or even thousands of pounds.

The survey was carried out by the Insolvency trade body, R3, which said that of those that were trying to save money on their holidays nearly 60 percent had decided to holiday at home. Those that decided that they still wanted to holiday abroad looked at other ways to save money, with over 70 percent reducing the cost of accommodation, 66 percent choosing cheaper travel, and 60 percent deciding to spend less money whilst they were on their holiday.

An official from the firm said: “People choosing not to have a holiday this year is likely to have grown out of necessity rather than choice. UK households will either simply not have the money to go on holiday as result of cuts to their disposable income or have decided to save their money in preparation for the difficult times ahead. R3’s latest personal debt snapshot revealed only a quarter (25%) of consumers believe their financial situation will improve over the next six months. The money saved from spending less or not having a holiday at all will provide individuals with a financial ‘buffer’ in case they fall on hard times.”

Tags: Brits, spain, choice uk, holiday, cheapest option, financial situation, choosing, current climate

No change in UK interest rates

Following the August Monetary Policy Committee Meeting the Bank of England has announced that the base interest rate is once again to remain on hold at its lowest level in the history of the Bank of England. The base rate has been at its all time low of just 0.5 percent for well over two years now, which has provided relief for many homeowners and borrowers who have seen their monthly repayments plummet.

Economists have now predicted that the base rate will remain at this record low for the remainder of this year, with some even going as far as to say that it could remain at 0.5 percent next year as well. In a poll that included 32 economists the majority believed that it would be next year before the base rate was increased and a handful said that it could be 2013 before rates increased.

The news that the base rate is to remain on hold comes as no surprise to most industry experts, as the MPC is reacting to the fragile economy by keeping the base rate low. There will be many people that welcome the decision to keep rates low, such as those with mortgages on variable rates. However, there are also some groups that want to see rates increased in order to try and bring inflation levels down.

One group said that rather than increasing the base rate the MPC could look at further increasing the quantitative easing scheme, as this would increase the amount of money available to companies.

David Kern, chief economist at the British Chambers of Commerce, said: “Every effort must be made to sustain the recovery. If the economy weakens further, the MPC should not hesitate to increase the QE programme.”

Tags: chief economist, interest, bank of england, rates, time

Lending figures expected to see mixed reactions

Over the past decade Britain has become addicted to borrowing, and up until the onset of the global credit crisis most people – including those with damaged credit – were able to get finance pretty easily with banks and financial institutions eager to loan money to anyone that wanted it. This has, of course, resulted in a huge personal debt mountain that has left many people struggling with their finances and unable to keep up with their debt repayments.

The Bank of England is set to release figures later this week relating to mortgage lending and consumer credit. It is widely thought that the figures will show that lending and consumer credit levels are very low. It is thought that whilst some people will find that the figures make for very bleak reading indeed there are many others that will see the subdued lending data as a positive sign.

Many city officials are likely to see the low lending levels as something that could dampen the economic recovery and reduce consumer confidence levels. However, some people will see them as a sign that Britain is not as addicted to debt as it once was and that consumers are now focussing on trying to clear their debts and live within their means rather than borrowing money at the drop of a hat to buy things that they cannot really afford.

Peter Dixon, strategist at Commerzbank, said: ‘Within the context of rebalancing the economy away from personal debt, these low figures may be no bad thing. Those who argue that borrowing should be stronger are missing the bigger picture.’

Ross Walker, economist at Royal Bank of Scotland, said: ‘The British household sector needs to de-leverage. This is happening, but at a snail’s pace. That said, a more rapid correction would probably be associated with recession in consumer and property markets.’

Tags: decade britain, credit, week, Britain, drop of a hat, city, business, mountain

Official tries to explain banks’ low business lending levels

It was announced recently by the Business Secretary, Vince Cable, that the big banks in the UK were failing to meet their agreed targets with regards to lending to small and medium sized businesses. Figures were released recently showing that based on quarterly results the banks had not met their targets, and were therefore not on target for meeting their annual business lending minimum figure.

The banks have argued consistently that the reason behind the low lending figures for small and medium sized businesses was that in the current climate many businesses did not want to take out loans. Banks claim that whilst they are making credit available for business customers the low demand for finance means that there is little they can do to increase their lending figures until demand increases.

This has now been backed up by an industry official, Anthony Thomson, chairman and co-founder of Metro Bank. He said that his bank is now targeting small businesses as its main customer but that demand for borrowing is low. He said that whilst many businesses had signed up to the bank the demand for finance was much lower than had been expected, which meant that the bank was unable to lend as much to business customers as it may have anticipated. He also said that businesses were failing to look for the best rates on loans.

He said: ‘I hate to sound like I am defending the big banks but our experience is that there is just not the demand for credit from small companies.’ He also said: ‘I always thought small firms would be very sensitive to interest rates, but they are even less concerned about the rates than consumers.’

Tags: borrowing, Anthony Thomson, banks in the uk, business, Metro, industry official, industry

Rising unemployment sparks debt fears

Increases in unemployment levels seen in the final quarter of last year have sparked concerns about rising repossessions and spiralling debt problems according to recent reports. Personal debt levels in the UK have been causing concern for the past few years, with the recession, global credit crisis, and difficult financial climate highlighting the debt problems that many people were experiencing.                                                                     

It has been revealed recently that the level of unemployment in the UK soared in the last three months of last year, with the figure increasing by 44,000 taking the total number of unemployed to nearly 2.5 million. Many of those affected by unemployment are younger people. Concerns have now increased with regards to how the rising level of unemployment will affect people that have debts that they are already struggling with and those that have a mortgage to pay.

In addition to this the strong possibility of interest rate rises this year will also impact upon the ability of consumers to pay both their mortgages or rent and their other debts such as credit cards, loans, and other forms of finance. It is thought that the base interest rate, which has been at an all time low of just 0.5 percent for the past twenty two months, will soon have to increase in order to curb spiralling inflation, which is at twice the target level set by the government.

The government has acknowledged that the level of unemployment soared in the latter part of 2010 but claims that it has now started to improve again. Chris Grayling, the Employment Minister, stated: “We’ve got a long way to go and I want to see these figures start to come down, but certainly the evidence is over the past month things have settled down and we are not seeing the increases we saw earlier in the last quarter.”

Tags: addition, concern, business, Minister, inflation, strong possibility

Consumers could be paying for their banking services

One consumer watchdog official has recently said that the idea of free banking in the UK is nothing more than an illusion, and that more and more of us are ending up paying for our banking services in one way or another. The spokesperson, Oliver Morgans, who is from Consumer Focus, said that banks were managing to extract money from current account customers in one way or another, so even if the account is advertised as being a fee free account the average consumer will still end up paying.

Morgans said that in addition to having to pay for our current accounts in one way or another, consumers in the UK were also putting up with poor service and performance standards. He said that whilst people liked the idea of getting something for nothing, most were not getting this, and were in fact compromising on the service that they were receiving to boot.

A number of practices have been highlighted as providing banks with the ability to make cash from their customers for having a credit account. Overdraft charges are one way in which banks are making their money, and many charge huge fees when the accountholder goes over the limit. Another way in which banks make money from current account holders includes having a packaged account, which can be quite expensive each month.

Another consideration that consumers will have think about is interest on their current accounts – or lack thereof. A rising number of banks have now stopped paying interest on debit balances for accountholders, and this means that accountholders are missing out on this money.

Figures have shown that in the last four or five years the interest on overdraft charges has increase, the number of packaged accounts that are active has doubled, and a rising number of banks now pay nothing at all in interest on customers’ current accounts.

Tags: consumer watchdog official, poor service, uk, huge fees, credit account, money figures, official, cash

Turner wants FSA to have more power to protect bank customers

The reputation of banks, and the confidence that consumers have in these financial institutions, has plunged over recent years, since the onset of the global credit crisis in 2007. With this in mind the chairman of the UK’s financial regulator, the Financial Services Authority, has called for the authority to be given greater powers to protect bank customers.

Lord Turner said that the FSA needs greater powers in order to protect consumers. The FSA is now set to launch a discussion paper based on the protection of bank customers. The debate will be centred around how the FSA could help, and what sorts of measures it could take in order to protect customers.

Officials from the FSA said that they want to find ways to take action to protect bank customers earlier on rather than having to wait until a number of complaints have been made before any action is taken. Some of the measures that the FSA is likely to look at will include the banning of some financial products, and a cap on the fees that are being charged on a variety of other financial products.

Lord Turner is set to argue that the FSA, or its replacement agency if it is disbanded, should be given greater powers to give bank customers the protection that they want and need. This comes following a surge in activity at the FSA, which has been cracking down on insider dealings, and has enforced a greater number of fines over the recent years.

Referring to the debate one FSA spokesperson said: “The debate will be about the types of things we do, different product regulation. Rather than waiting until lots of consumers have had to make complaints, can we take action earlier?”

Tags: financial, paper, confidence, hector sants, cap, replacement agency, onset, agency

Pressure on interest rates stems from inflation

Many borrowers with variable rate mortgages or loans could see their monthly repayments rise over the course of this year, as the pressure is piled on for the Bank of England and the Monetary Policy Committee to increase the base rate in order to keep a lid on inflation. The level of inflation has now soared to 3.7 percent, which is close to double the target level of 2 percent as set by the government.

There are now concerns that the MPC will have to make the difficult decision to increase the base rate so that inflation can be brought back under control. The base rate has been at an all time low of just 0.5 percent for nearly two years now, and this has brought welcome relief to many people with variable rate loans and mortgages, as it has resulted in their repayments coming down.

It is thought that inflation could continue to soar, and this rise in inflation will not be helped by the increase in VAT, which rose to 20 percent at the start of this year reflecting an increase of 2.5 percent. A number of other things were blamed for the increase in inflation, including food costs,  higher utility bills, soaring fuel prices, and air transport.

One economist said: “Despite the undeniably significant risk to growth coming from the fiscal tightening that is now increasingly kicking in, there is mounting pressure on the Bank of England to enact at least a token near-term interest rate hike to send out the message that it has not taken its eye off the inflation ball.”

The British Chambers of Commerce warned: “Raising rates at a time when fiscal policy is being tightened, while businesses and individuals are facing greater pressures, would be a mistake and should be avoided.”

Tags: policy, air transport, significant risk, Business Finance, variable rate loans, inflation ball

Huge fine for Barclay’s over investments

High Street banking giant Barclay’s Bank has been fined a fortune by the financial services regulator, the Financial Services Authority. The bank has been ordered to repay customers around £60 million, and has been fined £7.7 million on top of this, resulting in total fines of nearly £70 million.

The fines have been imposed as a result of investments that were mis-sold by the bank. The FSA carried out an investigation that revealed ‘serious failings’ in the way in which the bank had sold the two investments, which were Aviva’s Global Balanced Income fund and Global Cautious Income fund. The two funds were sold between July 2006 and November 2008, and the total value of the investments came to nearly £700 million.

According to the FSA the investments were mis-sold because the bank did not take into account a number of crucial factors when selling the funds. The regulator said that the funds were sold to over twelve thousand customers in total, but that the FSA did not consider important factors such as the financial circumstances of the customers, their investment knowledge and experience, or their investment objectives.

An official from the FSA said: “The FSA requires firms to have robust procedures in place to ensure any advice given to customers is suitable. Therefore, when recommending investment products, firms should take account of a customer’s financial circumstances, their attitude to risk and what they hope to achieve by investing. On this occasion however, Barclays failed to do this and thousands of investors, many of whom were seeking to invest their retirement savings, have suffered. To compound matters, Barclays failed to take effective action when it detected the failings at an early stage. “

She added: “Because of this, and given Barclays’ position as one of the UK’s major retail banks, we view these breaches as particularly serious and fully deserving of what is a very substantial fine.”

Tags: important factors, substantial fine, High Street, advice, financial services regulator, compound matters, funds, uk

Many Brits prefer keeping money at home than in banks

It has been reported that so many Brits are now losing faith in the British banking system that many of them have given up on putting their hard earned cash into banks and prefer, instead, to keep their money in their own homes, in places such as money boxes and safes, in drawers, and even under the mattress.

Since the onset of the global financial crisis the credibility of the banking system has taken a real knock, and many people now find themselves unable to trust banks. The lack of consumer confidence in the banking system is reflected in the number of people keeping money at home, and according to figures a huge number of Brits are collectively keeping around £7 billion around the home, not including the money that they carry in their purses or wallets.

Of the people that took part in the survey around 10 percent said that they preferred having control and possession of their own money rather than giving it over to a bank. However, many have simply decided not to bother putting their cash in banks because of the minimal returns that they receive on their savings, which has plummeted as a result of the rock bottom base rate, which stands at 0.5 percent.

However, one industry expert said: ‘Even though rates are currently low, those wishing to save money should always do so with a bank, building society or credit union which is covered by the FSA, the UK financial regulator. It is vital that savers know their money is protected up to the new limit of £85,000. By contrast, those deciding to keep money at home, whether as savings or for convenience, may not be covered by household insurance in instances such as burglary. Under new rules, if financial institution were to fail most customers will get their money in a few weeks, so there really is no need to stash it at home.’

Tags: British banking, rate, percent, Fractional-reserve banking, Banking, bank, household insurance, minimal returns

Santander admits to glitch over statements

Banking giant Santander has recently admitted that it has made a grave error that resulted in tens of thousands of its customer receiving the details of other customers on their bank statements. This is another of a string of security breaches made by banks and building societies over the past couple of years that has put consumer at increased risk of identity theft.

For many, ID theft is a very serious and frightening prospect and with fraudsters becoming more and more prevalent in the current climate many people have become increasingly nervous about falling victim to their crimes. However, security breaches such as the one by Santander can put people at increased risk of falling victim to this sort of crime.

According to officials from Santander it was a printing error that caused the problem on this occasion, as it resulted in pages from other people’s statements getting mixed in with accountholder statements that were being run to send out. This meant that whilst accountholder received details of their own transactions they also receive details of other accountholders transactions too.

Whilst the bank has apologised for the breach it has also said that customers accounts cannot be accessed using the details from the statements. An official from the bank said that although customers could see other customers’ details they could not be used to get into the account. Some customers are still worried though.

One customer said: “Initially I thought the statement was mine because my name, address and account number were correct, but when I turned the page over, I could see that transactions were someone else’s. I could also see the other person’s name, account number and sort code,” said Anne Robb, from Edinburgh. I called the bank to complain. The staff were very professional and helpful, but I am still concerned that someone has details of what money comes into and goes out of my account.”

Tags: run, banks, name, identity, robb, problem, theft

Survey shows households in UK still overstretched

A recent study has shown that households in the UK are still overstretched financially, with the findings showing that more than 50 percent of them have been struggling to repay their debts. The study was carried out by the Bank of England and involved polling around two thousand people.

According to the results of the study more than half of households were struggling meet repayments on debts such as credit cards, loans, and other unsecured debts. The results also showed that around 22 percent of consumers had been put off spending money because it was becoming more difficult to borrow money – this reflected an increase from the 16 percent that said the same thing in a poll carried out last year.

In addition to looking at difficulties with debt repayments and spending the survey also looking into how people thought they would be affected by government cutbacks. The results showed that a massive 90 percent of consumers thought that they would be affected by the cutbacks and spending cuts that were being imposed by the coalition government.

However, despite the fact that so many believe that the cutbacks will affect them less than 50 percent had actually taken any steps or action to try and prepare themselves for the possibility of being affected, such as saving more money, looking for a new job, or working longer hours. Reliance on credit cards and loans has been growing according to the Bank of England report, and a quarter of households are struggling to meet payments on bills.

In its report the Bank of England noted: “The burden of unsecured debt has risen this year, most likely reflecting a combination of weak earnings growth and the interest rates on unsecured debt remaining high over the past two years.”

Tags: Household, weak earnings growth, fact, United Kingdom, debt consolidation, addition, report, spending

Scottish consumers want more choice when it comes to banks

According to a recent report consumers in Scotland would be keen to see increased competition when it comes to High Street banks, and would like to see a greater choice of High Street banks. A survey was carried out by accountancy firm Deloitte, and the results showed that consumers would like to see more banks entering the market so that they have more choice with regards to which bank to use.

This comes despite the fact that consumer confidence in the banking industry is still low following the global financial crisis and the recession. However, whilst consumers are looking for more choice when it comes to the banking industry it also emerged that many would be worried about handing their money over to a new entrant in the market, especially in the current financial climate.

The Independent Commission on Banking has already launched an investigation into the state of competition in the UK’s banking system, and there is particular concern over competition amongst banks in Scotland because the Royal Bank of Scotland and Lloyds TSB are the dominant players in the sector.

The survey showed that around 30 percent of Scottish consumers wanted to see more choice when it came to High Street banks, and around 17 percent have switched some part of their banking to a rival provider, such as their savings accounts or mortgages. Deloitte officials said that these factors showed that there was room for new entrants to the banking sector in Scotland.

One official from the accountancy group said: “Our findings suggest that consumers will look to more established and recognised brands who extend into banking, with one in 10 saying they would be happy to bank with any large ‘household brand’. Further, consumers are more likely to take out certain products such as savings accounts from new entrants, but remain cautious about committing to longer term products such as mortgages.”

Tags: recent report, high street banks, lloyds tsb, official, whilst, confidence, bank, savings accounts

PPI bill for UK banks could hit £5 billion

An analysis group has claimed that the UK’s major banks could be facing a bill of around £5 billion in relation to PPI claims from customers that believe that they were mis-sold this cover. US investment bank officials from Morgan Stanley claims that this could be the bill that UK banks are facing over the next five years, with the estimates cost of dealing with these claims continuing to increase.

Barclay’s Banks, Lloyds TSB, and HSBC are amongst those that may be footing some of this huge compensation bill. The prediction comes after American banking giant, the Bank of America, had to set aside $592 million to deal with forecast claims over Payment Protection Insurance. Officials believe that the cost to UK banks will be even higher.

Morgan Stanley has said that at the very least, as a base case scenario, the bill for UK banks is likely to be just over £2.6 billion. However, this is based on only a quarter of PPI policyholders making a claim, and also on fewer than half of these claims being upheld. Should the claims and approvals be higher than this the cost of dealing with claims could be considerably higher.

The average payout to each successful applicant is likely to be around £2000. PPI came under fire after investigations showed that over the years banks and financial institutions had been involved in mis-selling the cover, and this has resulted in many people finding themselves eligible to make a claim for compensation.

The Financial Services Authority has been trying to clamp down on PPI sales, and has brought in new proposals. However, these are being appealed by the British Bankers’ Association, which claims that the financial regulator is trying to apply new rules and standards to old sales.

 

Tags: mortgage, bank, Primary dealers, Barclay's Banks, protection, Business Finance

Consumers need to be careful with bank statements and literature

Industry officials have warned that given the increase in identity theft and fraud over the years consumers need to start being far more careful with their bank statements and other literature that may have personal details on such as credit card statements, bills, bank letters, and other sensitive documents.

Many people tend to treat their personal documents, financial letters, and statements like normal waste paper, and simply put them into the waste paper basket when they are done with them or sling them into black bags outside. However, this leaves them open to identity theft because once they are in the rubbish outside they are accessible by anyone.

Experts have said that in order to minimise on becoming victims of identity theft and fraud consumers should ensure that all paperwork such as this is shredded properly so that others cannot access details about the accountholder. The advise has come from the fraud prevention service CIFAS, which has outlined some of the dangers that can lead to consumers becoming victims of identity fraud.

CIFAS said that the effects of fraud can be far-ranging, stating this could be anything “from finding out that a fraudster has set up, or attempted to obtain, accounts, products and services in your name, through to discovering that an existing account has been emptied by criminals”.

The agency said that it was not only paper documentation and bank details that consumers had to be careful with, as many fraudsters and identity thieves were now operating online. Officials said that it had therefore become increasingly important for consumers to be more vigilant and careful when reviewing or using their financial accounts via the internet, as otherwise fraudsters could quickly and easily gain access to important account and personal details.

Tags: name, Bank statement, Crimes, identity, theft, identity theft, fraud

Bank of England base rate needs to be increased

A member of the powerful Monetary Policy Committee has recently stated that it is essential that the base interest rate is increased in order to keep a lid on spiralling inflation, which could otherwise damage the economy. Andrew Sentance has voted to increase the rate for the past several months, but with the majority of members voting to keep the rate on hold the base rate has remained at its rock bottom level of 0.5 percent for the past nineteen months.

Sentance has said that the base rate should be increased gradually in order to try and curb inflation levels, which are currently way over the 2 percent target set by the government. Sentance was making a speech in London when he expressed his views, and minutes of Bank of England meetings show that he has voted for increases in the base rate for the past few months.

Between June and September Sentance was the only member of the Monetary Policy Committee that voted for an increase, but with all others voting to keep rates on hold the base rate remained static. Its current level is the lowest in the history of the Bank of England, which spans over three hundred years, and it was reduced to this level under the former Labour government amidst hopes that it would help to aid the failing economy during the global financial crisis and the recession.

In his speech Sentance stated: “I have voted for a rise in interest rates at recent MPC meetings — as a start to a gradual movement away from the exceptional level of monetary stimulus put in place to combat very difficult economic conditions last year. And I continue to believe that this is the right policy for the situation the UK economy currently faces.”

Tags: hundred years, london, Monetary Policy Committee, year, interest rates, Monetary policy, bottom level, Andrew Sentance

Banks fleecing customers with overdraft fees

It has been revealed in a recent report that many of the UK’s banks are fleecing their customers with extortionate overdraft rates and fees despite the fact that many of the customers, as taxpayers, have a stake in the banks because of the bailouts that occurred during the credit crisis, which were funded by taxpayers’ money from the public purse.

Last month these overdraft rates are said to have hit a new high, coming in at an average of 19.1 percent. This is despite the fact that the base interest rate still stands at a record low of just 0.5 percent, which is where it has stood for the past eighteen months. The margin between the base rate and the rates that banks are charging on overdrafts is now astonishingly wide, and many of the most cash strapped customers are being hit with the rocketing overdraft charges.

Natwest and the Royal Bank of Scotland are said to be amongst the worst offenders, and these are both part of the RBS Group, in which taxpayers have a massive 84 percent stake. The average rate of interest charged on overdrafts was a massive thirty eight times more than the base interest rate, which means that banks are making a huge profit from customers that fall into the red.

An official from the Independent Banking Advisory Service said: ‘Banks have been allowed to increase their margins despite the bank rates being so low. There is no incentive for them to do otherwise. The level of profiteering is completely out of control. Nothing about it is fair or reasonable. We face reduced incomes and increase household bills and yet again the banks are compounding our misery. We bailed them out but they have no qualms about making matters worse in our hour of need. The Government should introduce a cap on the rates. But instead it protects the banks at our cost.’

Tags: Bank charge, fee, bank, overdraft fees, high, crisis, interest rate

Trust still shrinking in UK banks

It has been claimed that the level of trust in UK banks is continuing to shrink amongst consumers following the chaos that followed the global financial crisis. The boss of Co-op said that as a result of lack of trust amongst consumers in the banking sector many were continuing to shun traditional banks.

Peter Marks, the Co-op chief, said that banks had been through a tough time since the onset of the global credit crisis, but he added that most had deserved it because they did not always act ethically. His comments came after the Co-op Bank released its performance and profits figures recently.

The bank’s first half pre-tax profits came to £260 million, which was a hike of 17 percent. Current account openings were said to have increased by 30 percent, and lending to small businesses apparently nearly doubled from £600 million to over £1 billion.

However, confidence levels in the banking sector have been sliding since the chaos that occurred with Northern Rock, which became the first official financial victim of the credit crisis in the UK. Since then various reports ranging from huge banking bonuses to senior staff to security breaches and lack of lending have seen consumer confidence take a further battering.

At one point following the credit crisis many were too nervous even to put money in the bank, and many were keeping their savings at home or in alternative places because of their lack of confidence in banks to keep their money safe.

One industry expert said: “Some banks do deserve the battering they have taken when it comes to customer confidence levels, as many have not acted ethically. It doesn’t help when all consumers see in the papers and on the internet is reports of bosses being paid huge bonuses whilst consumers are left earning little to nothing by way of interest.”

Tags: money, Cooperative, bank, financial crisis, economics, lack of trust, customer, Co-op Bank

Apologies from Santander over poor service

An apology has been made by the Spanish owned bank Santander over the poor level of service it has given to hundreds of thousands of customers. The service problems have resulted in a range of problems, including delays with savings accounts being opened, problems with access to online accounts, and failure of bank staff to carry out transactions.

Steve Williams, director of service quality and complaints, made the apology last week, and the apology came after an investigation was carried out by the Financial Mail into chaos with administration at the bank. The bank, which took over a number of UK financial institutions such as Abbey and the Alliance & Leicester, has been accused of a number of failings following the investigation.

According to reports the bank has put all of its efforts into ensuring that the level of service is extremely high for its current accounts. However, in doing this it stands accused of letting customer service levels falls in other areas. In the first half of this year the bank received almost a quarter of a million complaints, the majority of which were in relation to its customer service levels, and this is what sparked the investigation.

Mr Williams admitted the bank’s failings when he made the apology, and he said that the bank was a growing one and that it understood that there were areas that needed to be addressed with regards to its service levels and other areas. This will partly be done through increased staffing.

Williams said: ‘We are creating more than 600 new jobs in our British branches and call centres. These roles will support our business and growth while enabling us to continue improving our service to customers.’

Tags: complaints, alliance & leicester, bank, access, finance, Mail, santander

Villages being affected by bank closures

It has been reported recently that many villages in the UK are being affected by bank closures, with many bank branches having closed since the turn of the century. An investigation was carried out by the Campaign for Community Bank Services (CCBS), and this suggested that more than two thousand bank branches had closed since 2000, and this has left many people living in smaller villages stranded when it comes to conducting their banking.

For many of those living in rural areas and small villages there is a particular problem because lack of broadband facilities makes it difficult for them to benefit from other options such as online banking due to lack of internet access. With many bank branches in smaller villages now struggling to stay open, despite profits recently posted by banks, villagers may really struggle to access banking services properly.

A number of major banks are said to have shut hundreds of branches in some cases over the past decade, and Lloyds TSB said to have closed around five hundred branches. It is the branches in smaller areas and villages in particular that are suffering, and many officials are now concerned that vulnerable, elderly, and disabled people could experience real problems if they are unable to travel further afield to access banking services.

An official from Campaign for Community Bank Services, Derek French, said: ‘We are concerned that banks will continue to close quieter branches and concentrate on meeting sales targets in busier, more profitable High Street branches.’  

With banks having been hit hard financially over the past few years there are also concerns that many may focus of closing branches to save money rather than making cutbacks in other areas, which will further impact on the accessibility of services for many consumers.

Tags: derek french, consumers, Branch (banking), bank, bank closures, bank branches, branch

No move for base interest rate

The Bank of England has announced that the base interest rate in the UK is to be kept on hold once again, which means that this will be the eighteenth month in a row that the base rate will have been kept at the record low of just 0.5 percent. The announcement came after the August Monetary Policy Committee meeting.

The decision to keep the base rate at 0.5 percent, which is the lowest in the history of the Bank of England, has sparked speculation that the Monetary Policy Committee is not all that concerned about rising inflation, which at present is much higher than the government target of 2 percent but is expected to fall closer to its targets level over the course of the year.

The central bank also said that the quantitative easing programme was still on hold. The programme was started by the former Labour government, and so far £200 billion has been pumped into the economy through this scheme. The MPC has now said that whilst the scheme will be kept on hold for now there is still scope to use it again in the future should it be necessary.

In the meantime many industry groups have welcomed the decision for the bank base rate to be kept on hold, with officials stating that this could help to revive the economy. The British Chambers of Commerce said that the cuts that the coalition government had made to address the public deficit would impact on the economy, so keep the base rate on hold had been a necessity.

David Kern from the BCC said: “The MPC made the right decision. The tough deficit-reduction measures announced in the Budget, although necessary, will inevitably increase the threat of a UK economic setback. Given the precarious economic background, it is absolutely vital that the MPC maintains the current low level of interest rates until the second quarter of 2011 at the earliest.”

Tags: interest rate, Monetary policy, bank base rate, bank of england, Central bank

Lloyds Banking Group retains position in UK mortgage lending market

Figures that have recently been released have shown that banking giant Lloyds Banking Group has managed to retain its position in the UK market when it comes to mortgage lending levels. This comes despite the problems that the mortgage markets have experienced since the onset of the global financial crisis and the recession.

The figures show that Lloyds Banking Group managed to retain a 23 percent share of the gross mortgage market in the UK, despite the fact that the markets have remained subdued. The large market share of the mortgage market that has been taken by the group means that it remains as one of the leading mortgage lenders in the UK.

Lloyds Banking Group has also enjoyed success when it comes to profits, having announced profits of £1.6 billion for the first six months of this year. For the same period a year ago the bank reported losses of £4 billion, which means that the banking group’s fortunes have really turned around, as have those of a number of other banks in the UK. The money that Lloyds Banking Group has set aside to cover bad debt is also said to have fallen, and has gone from £13.4 billion to £6.5 billion.

Despite the profits that Lloyds and other banks have reported industry groups have expressed concern that mortgage lending is still restricted, as banks are still being cautious and many are still demanding high deposit from those looking to take out a mortgage.

Mortgage brokers have a more optimistic view, and many have predicted that they will be doing increased levels of business as the year goes on, as more and more mortgage products become available on the market.

Tags: Mortgage broker, uk, Lloyds Banking Group, mortgage, bank

Fall in lending to businesses seen in May

According to recent reports the level of lending to UK businesses fell in May, despite efforts from industry groups and the government to try and boost lending by banks to businesses. Whilst the level of mortgage lending in May improved compared to the previous month the level of business lending took another hit.

The figures have been released by the British Banker’s Association. The level of lending to private, non-financial companies is said to have plunged by £1.3 billion in the month of May, which was slightly higher than the fall seen in April but slightly lower than the average decline seen over the past six months.

These businesses are said to form the backbone of Britain’s economy, and many have highlighted the importance of enabling these businesses to borrow the money that they need. However, banks are still being very cautious when it comes to lending, as many are still reeling from the financial meltdown.

In addition to this the falling demand for finance from these businesses is also affecting lending levels, and many businesses are loathe to take out costly loans and finance in the current climate. With fewer businesses wanting to take the financial risk of borrowing more money demand levels have fallen and subsequently so have lending levels.

Officials have also said that there has been an increase in retail sales, with the higher property sales levels now impacting upon the retail sector. Household goods and furniture retailers were said to have seen improvement, as did grocery retailers who may have benefitted from people stocking up for the World Cup.  Electrical retailers also benefitted as a result of people buying new television sets in preparation for the World Cup.

Tags: bank, credit, loan, finance, business

Interest rates need to rise in the UK

It has been claimed by an organisation that the base interest rate in the UK needs to be increased in order to keep inflation under control, with the group claiming that it is necessary to increase the rate this year and increase it further over the course of next year.

The claim was made by the Organisation for Economic Co-operation and Development, which has stated that the base rate needs to be increased this year and by the end of next year needs to be at around 3.5 percent in order to keep a lid on inflation, which has already been soaring past the government target of 2 percent.

The base interest rate has been at its lowest level in the history of the Bank of England for well over a year now, standing at just 0.5 percent. However, inflation has been soaring and some officials now believe that in order to bring inflation down the base rate will need to be increased.

If the base rate does go up the cost of borrowing could also rise, which means that consumers may have to pay more interest on loans and mortgages. The OECD has said that whilst the government made the right move by reducing the base rate to this rock bottom level during the recession it was now time to consider increasing it.

A report from the OECD stated: ‘The gradual drift up of some measures of inflation expectations implies a need to increase interest rates earlier than previously thought and no later than the last quarter of 2010. The projected increase of core inflation to the Bank of England target warrants an increase of the policy rate to 3.5% by end-2011.’

Tags: finance, OECD, borrowing, interest rate, cost of borrowing, Mortgages

Another drop in lending by banks to businesses

Recently released figures have shown that for the month of April the level of lending by UK banks to non financial businesses fell, with lending falling by £1.1 billion. The figures were released by the British Bankers’ Association, and officials said that whilst April marked another fall in business lending the level of the drop was smaller than those seen in the previous six months.

In the past six months the average decline seen over the period was £1.6 billion per months, so the April drop is significantly lower. Industry groups and government officials have been urging banks to lend more to businesses because of the importance to the economy, and the drop in lending seen in April has been put down to a number of factors.

The British Bankers’ Association has claimed that part of the reason that borrowing to businesses has fallen is because there is a lower demand for finance from UK businesses, as many are exercising caution when it comes to borrowing. The BBA said that figures from the Bank of England showed that corporate deposits had been rising sharply.

However, other industry official believe that it is not just lack of demand that is hindering lending from banks but also the fact that many businesses are struggling to get finance from banks even in cases where they need to borrow the money. On a separate note the level of net mortgage lending from banks also fell in April, dropping to £1.8 billion.

Economist, Ed Stansfield, stated: “April’s soft mortgage lending data add weight to the idea that last year’s upturn in approvals overstated the underlying health of the housing market. Moreover, since the looming fiscal austerity measures will keep a lid on mortgage demand while the uncertain funding outlook will limit the supply of mortgage credit, weak lending looks set to remain the norm for some time.”

Tags: finance, mortgage, british bankers association, Business_Finance, bank

Overdraft interest charges hit highest level in ten years

Since the catastrophic global credit crisis swept across the UK, leaving the banking industry to face huge losses, the UK’s banks have been taking whatever steps necessary to try and recoup the massive losses, which were made worse by the recession, which left many borrowers unable to continue with repayments on loans, credit cards, and other forms of finance.

Reports have highlighted the various ways in which banks have been trying to claw back their financial losses and shore up their own finances, including reducing the interest paid on savings accounts to little or even nothing in some cases, and sneakily increasing the interest rates charged on loans and other forms of credit.

Another recent report claims that the interest rates being charged on current account overdrafts have now been hiked up to their highest level ten years, with the average rate of interest being charged on accounts that are in the red increasing to 14.22 percent.

The report states highlighted that this was twenty eight times higher than the base interest rate, which is at an all time low of just 0.5 percent, where it has been since March of last year. It also stated that the base interest rate was a massive 6 percent last time average overdraft interest rates exceeded 14 percent. Officials believe that this is yet another move by banks to try and make more money from customers and improve their own profits.

An official from the financial industry group Moneyfacts stated: “Despite eventually winning the OFT case banks made significant changes to the level of charges they will levy for unauthorised borrowing. As one revenue stream closed inevitably they have moved to find another. Banks are likely to be making more now from these increases than they ever were from penalty charges.”

Tags: bank, interest, finance, Bank charge, overdraft

PPI mis-selling results in compensation of millions for consumers

Consumers in the UK have won back millions of pounds from banks and insurance companies as a result of being mis-sold insurance or becoming victims of administrative errors. According to figures the total amount won back by consumers who were mis-sold insurance or experienced errors in the last six months of last year was £284 million.

The reports show that the majority of these cases related to consumers that had been sold payment protection insurance, also known as PPI. This was a type of insurance sold alongside credit such as loans and credit cards, but came under fire several years ago after investigations found that it was being widely mis-sold by many providers of financial products and services.

The Financial Services Authority, the UK’s financial regulator, made these figures public recently, and also revealed that banks had received over 1.1 million complaints relating to unauthorised overdraft charges. Banks are now dealing with a huge backlog of these complaints following the removal of a ban on addressing the complaints, which were frozen as the bank charge case went through the High Court and then the Supreme Court.

Banks and insurance firms were said to have received 2.7 million complaints between July and December of last year, which compared to 1.6 million in the six months previous. The figures also showed that of these 45 percent were upheld in favour of the consumer.

The Financial Services Authority has, in the meantime, said that it will be coming down hard on banks that are found to be failing to deal with customer complaints effectively, and has warned that there are some banks that are trying to force customers to buy financial products that they do not want or need to shore up their own finances.

Tags: financial products, finance, bank, Insurance, Financial institutions

Loan hikes have made millions for UK banks

According to a recent report banks in the UK have managed to make millions of pounds as a result of sneaky hikes on loans and other forms of borrowing. The claims have been made following an investigation by a finance group, which shows that since they started making huge losses during the credit crunch the banks have been merciless on their attack on consumers in order to try and shore up their own finances.

It is claimed that banks have been making up the losses on their books by slyly increasing the rates of interest charged on borrowing whilst at the same time reducing the rate of interest on savings accounts to the point where some savers are earning practically nothing on the money that they put into their savings.

Officials claim that banks are getting away with this because of the rock bottom base interest rate, which still stands at just 0.5 percent, which is the lowest it has ever been in the history of the Bank of England, and it has been at this level for well over a year now.

The low base interest rate has fooled many people into thinking that borrowing is cheap at the moment. However, what has in fact happened is that the gap between the base rate and the rates that lenders are charging has expanded resulting in what has been described as an eye watering margin. The fact that the base rate is so low, coupled with the fact that many of these banks have been bailed out by the taxpayer, appears to have provided no benefit to borrowers.

An official from the consumer campaign group Which? said: ‘We paid for the banks’ failures once when we bailed them out and now they are getting a double hit by taking more of our cash.’

Tags: investigation, finance, Loans, credit crunch, Economic history, banks, interest rate

Tesco wants 10 percent share of financial market

It has been reported that the supermarket giant Tesco is looking to take a 10 percent share of the financial market as it continues its launch into retail banking. Over the years Tesco, like a number of other leading supermarkets, has broken into a range of different fields, and retail banking is something that Tesco has been looking into breaking into for some time.

In 2008 Tesco revealed its plans to break into retail banking, and this decision was welcomed by many given the problems that had arisen with traditional High Street banking giants. Last year saw the supermarket rebrand its Tesco Personal Finance brand to Tesco Bank in preparation for the move.

Already Tesco is now enjoying a reputation as the UK’s largest supermarket bank, and has around six million customers using a range of around twenty eight financial products ranging from loans and credit cards to insurance services. The supermarket wants to extend these services and build upon a customer base in current accounts, mortgages, and other financial products.

If Tesco does manage to reach its goal of taking a 10 percent share of the financial market it will be on level pegging with Abbey, which was recently renamed Santander after being taken over by the Spanish banking giant.

Officials have said that the fact that Tesco is a household name puts it in an excellent position to enter into the banking sector, as consumer confidence in its services may already be high. The move for a greater number of entrants into the banking sector is also something that is being encouraged by the government.

Many people have lost confidence in the traditional banking system over the past couple of years, and this could spell good news for new entrants to the market such as Tesco.

Tags: Tesco Bank, financial products, supermarket bank, retail banking, tesco

Demand for cheque alternative from pensioner group

It was announced last year that the banking industry is looking to do away with the cheque, which has been a method of payment for millions of older people for many years before debit and credit cards came along. Many pensioners and older people still rely on cheques to make payments for various services and purchases, and the announcement that the cheque was to be phased out caused concern that many of these people would be left without a viable alternative.

The banking industry has said that it is planning to phase out cheques by around 2018, but many officials have said that this could impact on pensioners negatively, causing them stress and difficulties. A pensioner group is now calling for an effective and suitable paper alternative to cheques to be offered so that those that cannot use the Internet to make payments will still have a viable choice.

The group that is lobbying for the paper alternative to the cheque is the National Pensioners Convention, and its protest to find an alternative comes shortly after the BCC revealed that more than 75 percent of pensioners were against cheques being phased out. The NPC is now calling for a guaranteed paper alternative to be offered to older people in place of cheques.

An official from the NAC said: “If cheques are taken away from older people it will create an enormous stressful situation for them, because their bills are paid on time, with a cheque, in an envelope and put in the post. We have told the authorities that what is going to be required is a paper trail to replace the cheques.”

A spokesperson for the Wandsworth Older Peoples Forum added: “A lot of people who are housebound use cheques daily, and a lot of people who have no computer and therefore can’t get onto the internet or do internet banking would be lost without it.”

Tags: cheque, concern, finance, pensioner, Social Issues, enormous stressful situation, time

More people to get access to bank accounts

According to recent report many more people will be able to get access to bank account facilities, after plans were announced by the government to force banks to offer bank account facilities to all. Under the plans, which were revealed in the recent budget, banks may have to offer at least a basic bank account to everyone that is legally entitled to have banking facilities in the UK. With banks having been at the receiving end of much criticism over the past year this is just one of the measures that are being looked at to try and tighten the way in which the UK’s banks operate.

The government claims that there are around 1.75 million people in the UK that have not got access to banking facilities at present, and hopes that this move will help to ensure that a large proportion of these people are provided with access to bank accounts. Many may be able to get basic banking facilities under the new regulations, and these are accounts that allow the accountholder to carry out transactions such as transfers, payments, receiving money, and setting up direct debits, but do not come with a cheque book or overdraft facility.

The British Banker’s Association has argued that the move is not necessary because people that want to have a bank account can have one anyway. Many of those that can only get access to a basic bank account are people that are on low incomes and are limited in terms of how much they can put into the account, or those that have a poor credit rating.

A promise was also made to move more quickly when deciding whether to grant a new banking licence to companies, and this was welcomed by consumer campaign group Which?. Officials from the group said: “People have been telling us how fed up they are with the sales culture that appears to have replaced customer service in our banks. New entrants in the market offering genuinely competitive products will help bring about the culture change the industry so desperately needs.”

Tags: bank, bank account, Banking, Ethical banking, bank account facilities, british bankers association, which

Desperate customers being shunned by banks

It has been claimed in a recent report that many banks in the UK are turning away many desperate customers who are in need of help with their finances. Read more

Tags: debt advice agency, United Kingdom, Financial Ombudsman Service, agency, position, bank, advice agency, previous year

Charities want banks to extend offer of services

A group of charities is urging banks in the UK to extend who they offer their services to, with officials from the charities stating that millions of people are being excluded from using banking services. Read more

Tags: basic banking services, Credit card, Better Banking Campaign, Payday loan, overdraft

Banks need to do more to help struggling customers

It has been claimed by the Financial Ombudsman Service that banks in the UK need to take more action to help consumers that are in dire straits with their finances and who need help to keep them afloat financially. Read more

Tags: turned away, financial assistance, debt management, customer, overdraft, Financial Services Authority, Financial Ombudsman Service, bank

Banks make the switch from Maestro

It has been reported that a number of UK banking giants are working towards replacing their Maestro payment cards to alternative such as Mastercard and Visa payment cards. Read more

Tags: personal finance, Debit cards, Credit Cards, switch, Maestro, Visa, MasterCard

Banks urged to provide services to those that are excluded

A group consisting of charities and local groups is urging banks to extend their services to those that are currently excluded from a wide range of banking services, such as current accounts, basic bank accounts, credit cards, loans, and overdrafts. Read more

Tags: bank accounts, overdraft, Payday loan, Credit card, quarter, Credit Cards, interest rates

Another data breach bungle by HMRC

It was revealed recently that HM Revenue & Customs had been involved in another data breach bungle, raising further concerns over identity theft. The latest blunder involved over two thousand letters being sent out to claimants with regards to child benefits, but many of them had the personal details of other people on. Read more

Tags: Data breach, Crimes, Taxation in the United Kingdom, United Kingdom, Data security, identity theft, HM Revenue and Customs, security

Warning for pensioners over tax codes

It was revealed recently that the systems being used by HM Revenue and Customs had resulted in millions of tax codes being incorrect, which in turn was leading to many people potentially paying too much or too little in the way of tax. Read more

Tags: end, Taxation in the United Kingdom, Low Incomes Tax Reform Group, finance, customs, Tax code, amalgamation

Data breach could result in FSA fine for Skipton

The Skipton Building Society has hit the headlines recently after it was revealed that there had been a serious breach of security. Over the past couple of years the topic of security breaches has become more and more of a concern, with many fearing that they have become victims of identity theft as a result of security breaches by banks and other financial institutions. Read more

Tags: National security, Skipton, building society, Data security, Financial Service Authority

Retail giant may move into banking

Over recent years a number of well known retailers and supermarket giants have started offering various financial services, such as insurance services, credit cards, and even loans. Marks and Spencer, for example, has its own M&S Money sector and supermarkets such as Sainsbury’s and Tesco have been offering financial products for some time. One supermarket giant, Tesco, has recently announced that it is moving into the banking sector through offering full banking services, which will be rolled out over the course of this year. Read more

Tags: insurance services, Financial services, tesco, Sainsbury, financial products, supermarket giants, car insurance

No movement in Bank of England base rate

It has been announced by the Bank of England that the base rate is to remain at its record low level of 0.5 percent once again, making this the eleventh month in a row where the base rate will have been at its lowest level in the history of the Bank of England. The decision comes just over a week after it was announced that the UK had finally joined other major economies by coming out of recession. Read more

Tags: economics, recessions, base rate, bank of england base rate, inflation, bank of england, interest rate

Savers group hoping for support

A savers group that was set up by a retired Surrey entrepreneur is looking for support in the hope of accumulating one million signatures so that it can petition Downing Street. The group is called Save our Savers, and it is hoping to fight the cause on behalf of around thirty million savers across the UK. It was set up by seventy year old Peter Duckworth, who invested around half a million pounds of his own cash to found the company. Read more

Tags: interest rate, savings, Surrey entrepreneur, voice, government

Bonus payments to Barclays executives to be deferred

It has been announced recently that the High Street bank Barclays has decided that it will be deferring bonus payments that were to be made to banking executives for up to three years. This means that directors and senior staff at Barclays will have to wait up to three years to get their bonuses, which are likely to be paid in the form of shares that are staggered up until 2013. Read more

Tags: bank bonuses, G20, United Kingdom, bank executives, barclays

Thirty billion a year attributed to fraud

Fraud is a type of crime that has hit the UK, as well as other major economies, hard over the years, and over the past few years, with the credit crisis and the recession taking their toll, the levels of fraud have become even more disturbing. Read more

Tags: Madoff investment scandal, Deception, fraud, insurance fraud, Crimes, U.S. Securities and Exchange Commission

Treasury gets involved in controversy over cheques

Recently it was announced by the banking industry that by 2018 it was planning to phase out the use of the humble cheque altogether. Over recent years a rising number of retailers have stopped accepting cheque as a form of payment, stating that cheque use can be time consuming and costly for businesses to process. This has led to the banking industry stating that it plans to get rid of cheques altogether over the course of this decade. Read more

Tags: bank, Payments Council, inclusion, consumers, treasury, Treasury spokesperson, Cheque and Credit Clearing Company

Faster payments possible if consumers change banks

The UK Payments Council has recently stated that many banks are still not making same day transfers to accounts at different banks despite the Faster Payments System that was brought in back in 2008, and officials from the council have stated that if customers are not happy about the fact that their bank does not provide this service they should consider switching to a different bank, as there are some that do provide this facility. Read more

Tags: finance, Payment Council, bank customers, Payment systems, Faster Payments Service, Single Euro Payments Area

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