Dealing with bank problems

They won’t let me open an account

Your bank or building society doesn’t have any obligation to open a bank account for you. They can choose who their customers are, although they can’t discriminate on the grounds of race, sex, disability, religion or sexuality. If you think you are a victim of discrimination then you can complain to the Financial Ombudsman Service, the organisation that sorts out problems between you and any company that deals with your money.

Fix it:

If you have a low income or low credit rating then you may not be able to open a regular bank account. In this case, your bank may be able to offer you a basic bank account.

I’ve been overcharged on my overdraft

The most likely problem is that you’ve gone overdrawn without agreeing it with your bank first. If this happens, they’re allowed to charge you a lot.

Fix it:

Set up SMS alerts so you know when you’re reaching your limit. If you think you’ve been unfairly charged, call your bank and complain. They must give you at least 30 days’ notice if they change the terms and conditions and tell you 14 days before they take any money out of your account.

They’ve taken money from my account without my consent

If a bank makes a mistake and removes money from your account, they must refund it and any costs you incurred by not having the money in your account (e.g. if you went overdrawn or you missed a credit card payment).

Fix it:

Call them immediately the quicker they find out and put the money back, the less likely you are to end up with direct debits not going through. If someone else takes money out of your account without your permission, or you suspect that they may be able to (if you lose your bank card, for example), you must tell your bank immediately. As long as you took reasonable steps to secure your account and report the fraud you won’t lose more than £50, although often a bank will ensure you don’t lose a penny.

Money has been used from one account to pay for charges on another

If you have more than one account with the same bank, they are allowed to take money from one account to pay for bank charges or being overdrawn on another.

However, even if you are overdrawn you do still have the right to choose how any further money paid into your account is used i.e. for paying your mortgage or your rent. This is called the first right of appropriation.

Fix it:

If you are expecting a payment to be made into your account, make sure you write to your bank before the funds arrive instructing them how you wish to spend the money. You will have to do this EACH TIME you expect a deposit.

They’ve given me free money!

Unlike Monopoly, a bank error in your favour doesn’t mean you get to keep the cash. The bank has the right to recover the money.

Fix it:

If you’ve already spent the money, the bank will usually allow you to pay it back in interest-free instalments. In some instances, if you didn’t realise the bank had made an error and spent the money in good faith, they might let you keep the money. However, if you don’t return the money you could be taken to court for theft.

Err…my bank’s gone bust…

If a bank becomes unable to operate it will usually be taken over, either by another bank or by the government and your money will be totally safe.

Fix it:

If the absolute worst were to happen, you can claim up to £75,000 back from the Financial Services Compensation Scheme (FSCS).

How do I complain about my bank?

If you think your bank has made a mistake, then there are steps you can take to complain. Here’s a quick step-by-step guide:

• Make sure the complaint is genuine. Your bank isn’t at fault if you let someone else take money out of your account (e.g. if you give someone else your card and pin).
• Collect written evidence of the problem (statements, letters, etc) and arrange a meeting with the person dealing with your account, or a branch manager. Alternatively, put it in writing and send it to your bank. Keep records of all interactions about the problem.
• If you’re not satisfied with the response, ask for the bank’s complaints procedure and follow the process. After eight weeks, if you’re still not happy, you can contact the Financial Ombudsman Service as long as it’s within six months of receiving your bank’s final response.
• Finally, you can consider going to court. This can be expensive and is very rare, so you’ll need expert legal advice speak to Citizen’s Advice for help.