Packaged Bank Accounts
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Your Guide to Mis Sold Packaged Bank Accounts
Millions of people in the UK and Northern Ireland currently have packaged bank accounts and a huge number of these have been mis sold.
The problem many people have is that they simply do not understand what they are paying for or why. In some instances, people who have a packaged bank account understand the product, but most people are simply left confused.
This guide will help you clarify what you are paying for, whether it is worth it and importantly whether you were mis sold your packaged bank account.
Packaged Bank Accounts are bank accounts that come bundled with other benefits, such as insurance and charge the account holder a monthly fee.
Not all packaged bank accounts are bad. For some people, a product which bundles together items such as travel insurance, mobile phone insurance and provides additional bank advantages like guaranteed overdrafts can be ideal.
The simple test is to check what is bundled in with your packaged bank account and decide whether you would need to purchase these items if they weren’t already included in your account. If you don’t need them then the package is not right for you.
A simple example is travel insurance; if you don’t go abroad yet it’s bundled in with your packaged account then you don’t need it and shouldn’t be paying for it.
If you do use the products, such as travel or mobile phone insurance, then get a separate quote for annual cover and see if that works out cheaper than having it bundled in with your bank account.
In many cases it will be cheaper, in which case you are overpaying, and a package is not the best solution.
This is the area which trips many people up.
It has been shown that the Banks systematically mis sold these products for a number of years before they were ordered to stop, yet they still have customers who are paying for these packaged account years later.
The list of mis selling includes not just actions at the point of sale but also actions the bank took after you had the account. These include:
– You were misled into taking out the account
– A pushy salesman convinced you that this product was the only one that fitted your requirements
– You weren’t told you could have a free account
– You were told it was a requirement of buying another one of the banks products i.e. overdraft, mortgage etc.
– You were already too old for the product they were selling i.e. medical insurance
– The bank failed to check each year if you were still eligible for the product i.e. you hadn’t become ineligible for the medical insurance through a change in your circumstances
– You were promised discounts on other products either at the time or in the future
– The bank added on an administration fee without telling you
– The bank raised the price of the package without telling you
– You were moved to the account without ever agreeing to it
– You tried to cancel the product but were forced to keep it to retain the use of the other bank products i.e. overdraft
– You were told it could improve your credit score
– No one mentioned you needed to register your car or phone as part of the insurance eligibility
This is not an exhaustive list and as more people complain about mis selling there is evidence of other tactics that were used to convince people to buy the product. If you are unsure whether you qualify you can contact us, and we will advise you.
The primary regulatory framework for consumer credit activities is set out in The Financial Services and Markets Act 2000 (FSMA 2000) and in the Consumer Credit Act 1974. All banking in the UK is therefore regulated and a packaged bank accounts are a regulated financial product.
All sales are obliged to follow the regulations set down by the FCA and they must tell you about your statutory right to go to the free Financial Ombudsman Service (FOS) if you are unhappy with their response.
Usually, the Statute of Limitations Act sets out the deadlines after which you must make a complaint. But with financial complaints there are other deadlines that mean you have more rights.
Yes, you can. You should contact your bank and you can ask them to change your existing account to another product, often one without bank charges. You should also send them the full details of why you believe you were mis sold the account. Alternatively, you can ask us to help you with this process.
Assuming you can demonstrate that you were mis sold in the first instance, you are eligible to claim back all the fees you have paid to date, plus 8% interest. To date, the average claim is £1,300
Having dealt with millions of PPI claims over the past 20 years, banks are used to handling claims. If your claim is rejected, you could take it directly to the Ombudsman who will investigate for you, however the level of proof required to escalate your claim can be quite detailed.
You can claim for all the fees you have paid for as long as you have held the product but your complaint must be made six years from the event that you are complaining about or three years from when the point you knew, or could reasonably have known, that there was a problem. This means that even if you were sold a policy over twenty years ago by your bank, you’ve got three years from the point you realised that there was something wrong to make a complaint.
If you think you may have a case for being mis sold, you may be eligible to reclaim your fees plus interest. To start the process, you can call one of our team on 0161 477 4604 and we will do all the work for you.
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0161 477 4604
76 King Street, Manchester, M2 4NH
Bank Charge Refunds is a trading partner of Financial Claim Solutions Ltd and has a Company Registration Number 11570192. Financial Claims Solutions Ltd is Regulated by the Financial Conduct Authority (FCA) in respect of regulated claims management activities. Authorisation Number is 83841.
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