Overdrafts

A little while ago, our marvellous government decided that banks would no longer be allowed to charge a higher interest rate (or other fees) for unexpected overdrafts than for arranged ones. Which was always a bit of an odd move - I would have thought that that actually was a reasonable place where the charges could vary. Anyway, as a response to this the banks of course introduced new, and much higher, interest rates for all overdrafts. Which wasn't so much an unforseen consequence as one that was totally obvious.

Anyway, on Saturday I received an annoying letter from my bank, explaining that they had been oh-so-good to us, in that as part of their Covid response they had delayed bringing in the new, higher interest rates. However, the time had now come for them to do this.

Well, fair enough. I have had an overdraft facility with them for decades, and apart from one occaision when there might have been a short term dip (depending on the order in which things happened) I've never actually used it. Nor indeed would I intend to - there have always been cheaper ways to get credit.

But what really annoys me about this is the utter and inexcusable unfairness of the system as a whole. Yes, it's right that banks should charge interest on accounts that are overdrawn, but it's a bloody liberty charging punitive interest rates on such accounts when they have a 0% interest rate on credit balances. Indeed, there isn't a bank account out there that pays anything even close to the ~35% rate charged on negative balances. Frankly, I find it utterly and outrageously one-sided.

So that's my rant of the day. It is, of course, not a reason to switch bank (since they're all much of a muchness on that measure). However, it is worth noting that I am now up to two actual reasons for switching banks. I suspect that may be coming sooner rather than later...

#33: "Carte Blanche", by Jeffery Deaver

#34: "The Fall of Gondolin", by J.R.R. Tolkien (which was much better than "Beren and Luthien", which is nice.)