HSBC to offer text alerts to help stay within overdraft limits
HSBC has announced that from next month (June 2011) it will offer a text message alert facility to all its overdraft customers, giving a warning of when they near their borrowing limit.
This service will be free to request and is in addition to the bank's unique fee waiver policy.
The text alerts are part of a package of initiatives that HSBC is putting in place to help banking customers stay within their agreed overdrafts - and pay less in fees. The bank is also contacting all of its customers who pay over £180 per year in overdraft charges and who could benefit from HSBC's Pay Monthly current account. Pay Monthly, introduced in 2010, offers customers a bank account with a ‘hard floor' meaning they cannot borrow more than their overdraft limit, so no unarranged borrowing or return fees can be levied.
Mike Oliver, HSBC's head of Current Accounts, commented: "Introducing mobile phone text alerts will help the small proportion of our customers who sometimes exceed their borrowing limits, and offer peace of mind to those who don't. However last year, as a result of successful initiatives such as ATM alerts, Pay Monthly Account's introduction and our fee waivers policy, we saw a fifteen percent fall in occasions where customers broke their borrowing limit, and incurred a fee. We hope by adding text alerts even less customers will exceed their limits."
HSBC's Pay Monthly account has a monthly fee of £15, which means no HSBC customer need pay more than £180 per year for their banking, and the vast majority considerably less or nothing. Other HSBC bank accounts (Bank Account, Advance and Premier) all benefit from our fee waivers policy, which addresses the minor slips into unarranged borrowing by waiving or reducing more than 4 million fees each year, and would otherwise be a cause for complaint to customers.
Mike Oliver continues: "HSBC's Pay Monthly bank account will be an appropriate solution to many customers who regularly exceed their overdraft, but it's essential we fully review each customer's banking relationship with us. Without a change of behaviour, not allowing any accidental or unrequested overdraft breaches is likely to divert customers' problems to utility suppliers and other bill payments."
HSBC's Fee Waivers policy includes:
There is no fee for an overdraft request of £10 or less.
Arrangement fees charged are never higher than the amount by which a customer has exceeded their limit.
HSBC will not charge more then one arrangement fee per day. So if you forget your balance on Saturday morning and make four purchases, each of which is further above your agreed overdraft limit, you would only be charged once.
There is no fee if you go over your limit and you pay in covering funds by 11.59pm the same day.
HSBC customers who make a withdrawal from an HSBC ATM will be warned that they may incur a fee if the withdrawal takes them over their overdraft limit
Customers are given advance notice before arrangement fees are debited from their account (at least 14 days for informal overdraft arrangement fees).
HSBC will charge no more than £150 in unarranged overdraft fees per month. Customers can ensure they only pay £15 per month by opting for Bank Account Pay Monthly.
If debited arrangement fees or interest cause an account to go overdrawn or further overdrawn there will not be a further charge.
Lastly, HSBC is the only bank to give customers an alert at its ATMs, and warning if the withdrawal will take them over their overdraft limit and incur a fee.