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Supreme Court finds in favour of banks
British consumers who were hoping to have millions of pounds worth of unauthorised overdraft charges refunded, were left bitterly disappointed following a Supreme Court ruling on Wednesday 25 November.
The decision taken by the court has surprised and angered many, as this decision overturned earlier court rulings that allowed the Office of Fair Trading (OFT) to investigate the fairness of charges for unauthorised overdrafts. This has dealt a major blow to consumer groups who had been campaigning against bank overdraft charges which they believe to be unfair.
The Supreme Court ruled that the charges charged by banks were not concealed and consumers knew what they were getting themselves involved in when they signed up for the accounts. This means that the OFT could not test them under the idea that the charges were unfair.
Although this has left many consumers disappointed the OFT might be able to challenge the charges on different grounds.
Here is a review of the other top money stories of the past week commencing 23 November 2009.
Monday 23rd November
Third of Britons in fear of debt – The results of a European survey undertaken by fund manager Janus Capital have shown how British borrowers fear their debt levels more than the citizens of any other major European nation except Spain. Some 35% of respondents stated that they felt that their borrowings were too high relative to their income. The figures compare with a Europe-wide figure of 30 percent while only Spanish consumers felt in a worse position (45%). If you are worried that your debts are too high and you are unsure about how you will pay them, seek advice from the Consumer Credit Counselling Service (CCCS). They can give you free, independent and confidential advice on 0800 138 1111. It is also worthwhile reviewing your budget, moneybasics can help you do that here.
'Fee-free' bank account – This week a bank announced a 'fee-free' bank account. This means that the bank will not charge for withdrawing money from a cash machine, and there won't be a charge for any payments that bounce. The account also offers a good rate of interest if you deposit £1,000 each month. At the moment this account is only available to customers who have a mortgage with the bank. However, experts think that this could lead the way for other banks to offer similarly competitive accounts.
The decision taken by the court has surprised and angered many, as this decision overturned earlier court rulings that allowed the Office of Fair Trading (OFT) to investigate the fairness of charges for unauthorised overdrafts. This has dealt a major blow to consumer groups who had been campaigning against bank overdraft charges which they believe to be unfair.
The Supreme Court ruled that the charges charged by banks were not concealed and consumers knew what they were getting themselves involved in when they signed up for the accounts. This means that the OFT could not test them under the idea that the charges were unfair.
Although this has left many consumers disappointed the OFT might be able to challenge the charges on different grounds.
Here is a review of the other top money stories of the past week commencing 23 November 2009.
Monday 23rd November
Third of Britons in fear of debt – The results of a European survey undertaken by fund manager Janus Capital have shown how British borrowers fear their debt levels more than the citizens of any other major European nation except Spain. Some 35% of respondents stated that they felt that their borrowings were too high relative to their income. The figures compare with a Europe-wide figure of 30 percent while only Spanish consumers felt in a worse position (45%). If you are worried that your debts are too high and you are unsure about how you will pay them, seek advice from the Consumer Credit Counselling Service (CCCS). They can give you free, independent and confidential advice on 0800 138 1111. It is also worthwhile reviewing your budget, moneybasics can help you do that here.
'Fee-free' bank account – This week a bank announced a 'fee-free' bank account. This means that the bank will not charge for withdrawing money from a cash machine, and there won't be a charge for any payments that bounce. The account also offers a good rate of interest if you deposit £1,000 each month. At the moment this account is only available to customers who have a mortgage with the bank. However, experts think that this could lead the way for other banks to offer similarly competitive accounts.
Thursday 26th November
Banks to reveal the pay of their top earners – A report published by Sir David Walker has said that British banks should be forced to disclose the number of employees who earn more than £1m per year. The Walker Review was commissioned by the government in February following the crisis in the UK and the global finance sector, much of which was blamed on excessive risk-taking by banks and bonus payments. The report includes the proposal for a new law that will force banks to publish the pay of their top earners in bands of those earning between £1m and £2.5m; £2.5m and £5m; and over £5m. The Chancellor, Alistair Darling, said the Government strongly supported Sir David's recommendations and will 'take steps to implement them as soon as possible'.
Banks to reveal the pay of their top earners – A report published by Sir David Walker has said that British banks should be forced to disclose the number of employees who earn more than £1m per year. The Walker Review was commissioned by the government in February following the crisis in the UK and the global finance sector, much of which was blamed on excessive risk-taking by banks and bonus payments. The report includes the proposal for a new law that will force banks to publish the pay of their top earners in bands of those earning between £1m and £2.5m; £2.5m and £5m; and over £5m. The Chancellor, Alistair Darling, said the Government strongly supported Sir David's recommendations and will 'take steps to implement them as soon as possible'.
Friday 27th November
Be prepared in case of flooding – Over the past 2 weeks heavy rain hit the UK and many families were forced to leave their homes as flooding became a problem. Flooding can cause havoc and many families have had to return to find their homes damaged by the water. It is for this type of unexpected calamity that home insurance is so important. The Association of British Insurers (ABI) have said that the average cost of flood damage to homes is between £20,000 and £40,000. Although the National Flood Forum has said that different companies treat customers differently when they are trying to make a claim on their insurance policy for flooding damage, these sums of money mean insurance cover is essential. For more information on the different types of insurance, see the Insurance section of moneybasics.
Be prepared in case of flooding – Over the past 2 weeks heavy rain hit the UK and many families were forced to leave their homes as flooding became a problem. Flooding can cause havoc and many families have had to return to find their homes damaged by the water. It is for this type of unexpected calamity that home insurance is so important. The Association of British Insurers (ABI) have said that the average cost of flood damage to homes is between £20,000 and £40,000. Although the National Flood Forum has said that different companies treat customers differently when they are trying to make a claim on their insurance policy for flooding damage, these sums of money mean insurance cover is essential. For more information on the different types of insurance, see the Insurance section of moneybasics.
