On Barclays profiteering from honest customers using their 24/7 rule and the ‘returned payment’ chain

Hobbes, seriously, the banking system in the UK get away with so much that once they put themselves in the spotlight as brainless individuals of dubious IQ as they have, we should move to regulators (SEC? FSA? even worse hollow heads than the bankers themselves), and then get rid of this politicians who, against public opinion, should be paid 10 times more than they are and made accountable (and fired if needed) as any executive of a listed company.

Anyway, what made me mad today was Barclays profiteering. Again.

Let me tell you a little story. We’ve got a small business and we try to manage our minimal finances as independently and debt free as possible. A mistake of the past was getting a loan for 50% of the cost of a van that we needed at the time but not now.

Anyway, on Wednesday, December 17, we paid a supplier with a £5,000 cheque. We were waiting for some moneys to arrive from some customers of ours in the next days and consider sensible paying a couple the supplier. In need of cash, as everyone else in these dire times, the supplier tried to cash the cheque yesterday when in the current account there were only £206.97. The same morning, one of our clients paid us £2,808.25. To face the payment of the cheque I also transferred the total from the company’s savings account £440.05 (not much, I know, but as said before, dire times) and £1,000 from my personal account (HSBC, they offer fast payments).

At that point, the account was overdrawn £544.73, so I went down my local Lloyds TSB and withdrew £600.00 (they don’t offer fast payment facilities, well they did for a short while, but they changed their minds shortly after).

Yesterday, December 18, around 2h20pm I went into one of Barclays branch in Knightsbridge and deposited £600.00 in cash. I had problems in the past with their readiness to bounce payments back before the day is gone, so I promptly asked the cashier (blond lady, 28-32 years old, far right window) whether I was in time for the cheque not to bounce back. I specifically told her that it happened in the past and I wanted to make sure that this time it wouldn’t happen. She looked at the screen, and told me not to worry, that “it would not bounce back”. Last night’s balance? £5,055.27.

So a photo of the bank statement looks like this:

screenshot1

You will notice that the cheque bounced back ‘also’ on December 17, but as far as the blond lady, 28-32 years old, at far right window and I are concerned, that was not the expected outcome after 2h30pm.

This morning I checked online in fear the bank statement and knowing that their staff’s word is completely worthless.
Regardless of what our bank statement says (we had funds on December 17) and regardless of what their branch employee told me, they gladly made the cheque bounce. Not only they did so, but to add insult to injury, they graciously charged us today £35 as commission, for the bounced cheque that shouldn’t have to, I suppose.

I seriously think that they do this on purpose or out of utter ignorance from their staff, and I don’t know what is worse.
If your heart beats, you will know that small companies are struggling at the moment, and here we have two small companies trying to survive and all Barclays bank does is LIE at the branches and STEAL from the customers the day after.

But look at it this way: Their supposedly incompetence has created a chain reaction of defaulted payments along the board. Not only they don’t care, they most likely are profiteering from that chain as several businesses are their own customers, so at £35 the pop, Barclays and the like thank us for falling into their trap. How much did they make this time? £70? £105? £140? Of course we don’t know, but that’s a nice way of making money, isn’t it?

We always complaint about the fees banks charge us for bounced payments, but we never think that, the creditor also gets charged a fee. So double (or triple or…) whammy for each returned payment. If we even return them within the same day regardless of any deposit made in the account, even better.

We assume and honour our responsibility as clients of the bank, but Barclays is not being fair with small companies, especially when we don’t even need or use their overdraft facilities (perhaps that is the problem). In our case we don’t need overnight finance, just that they allow us to move the money around before closing day, and since they bounced this £5,000.00 cheque back even though before 2h30pm we had that amount sitting on our account, I make it that they bend the rules when they want, and don’t even bother to communicate that to their own branch staff (or perhaps they are just careless or plain ignorant at branch level? I once heard that they train them ‘not to make decisions’. Discuss).

I once had this massive row at a Barclays branch, they told me that the money should be available in the account at midnight the day before (or midnight on Friday if the payment arrives on Monday. My point was that that didn’t make any sense at all, as days have 24h or 7 working hours, not 24 for the bank and only 7 for the client. Needless to say, I went nowhere, but my wasted time, effort and anger got me the £35 back then. I hope that also this time.

We cannot expect the government (or any government, as a matter of fact) putting itself on the side of the citizen, or as I like to call myself, customer of the government. Banks get our tax money (and myself I guess, as I am a small disgruntled RBS investor) and carte blanche to write their own personal definition of ‘fairness’.  Watch your back as no one else is.

.calvin

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3 Responses

  1. Hmm, the funds for cheques needs to be in your account the working day before any cheques leave. I thought everybody knew that! (It’s in your terms & conditions).

    I know what your going to say, who reads their terms & conditions. If you don’t is that the banks fault, if you get caught speeding and didn’t see the camera, is that the governments fault. NO it’s yours.

    And if you had of read your T&C’s then this wouldn’t have happened.

    Your balance on 16th was £206.97, forgive me if i’m wrong but £206.97 is not enough to pay a cheque of £5000!!! You could have paid in £1m on the 17th and it would have made no difference.

    And as for small businesses suffering and finding it hard at the moment, don’t forget what a bank is, it’s a business aswell. There to make money for themselves, and a large business has a lot more to lose than a small business.

    As for the charge, tough, swallow it, it’s your fault!

    • Dear Martin,

      I personally hope that you work or are somehow a banking socialite, otherwise I don’t see why anybody would side with less than honorable and dubious rules or, as you call them, T&Cs.

      In the first place, your analogy with speeding is bogus but let me use it to show why you are wrong.

      First, you need to pass an exam and proof that you know the “law” before you are allowed to drive. While you are correct when pointing out that “if you had of read your T&C’s then this wouldn’t have happened” that doesn’t make it more honest or shameless from their side, and that is the essence of my post.

      Second, if I ask a policeman what’s the maximum speed on the motorway, he tells me 70mph and I receive at home a fine for driving at 70mph on a 50mph area, I was misinformed by the “gatekeeper”, and since I am legally expected to know the law, your commentary would apply. Not now.
      Having said that, and since you brought up the Government and the motoring topics, too many times I have asked a traffic warden if I could park on the yellow line and the answer has been “yes and no, I am not sure, check on the website”. I rise my same complaint.

      Moving on to “a large business has a lot more to lose than a small business”. I don’t really know where you get this thought from. A small business normally has fewer employees or a single sole trader. What does a big business have to lose? A small business has its livelihood on the line (and probably the owner’s family as well). Can you please be more specific about what a large business has to lose? Face? The fact that they returned the fees talks volumes. The squeaking chair gets the oil. Sad that not everybody has the time/patience to squeak.

      .calvin

  2. I’ve been trying to speak with my Natwest Business Account “relationship manager” since before Christmas only direct number to her is mobile, always on voicemail where she says she will endeavour to get back to me by the end of the day ha ha ha. The office number where I am assured that someone will be able to help me quickly tells me (when it is not constantly engaged) and I quote, that I will need to speak to “one of her little chums”.

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