2018-05-12

Real banks are shit, but "challenger" banks are more shit, maybe?

[I've added some constructive comments at the end of the blog now]

I have had a lot of issues with Barclays over the years, especially where card payments are declined for no good reason (and where they allow fraudulent ones that are so obvious to anyone that it is fraud, against Barclays, it is unbelievable).

So I am very wary of using Barclays for anything, and hence have Monzo and Starling accounts. Both are great at letting you know what happens in real time on mobile apps and recommended to most of my friends. For most people both work well, but I have to say I would now recommend Monzo.

But, it seems, neither can do the job of a "proper" bank, in my view.

I am booking a cruise with my (rich) friends. As I have blogged before we take turns for holidays, and between us we are doing another cruise. The total comes to more than £10k between us. I'll no doubt post pictures and videos at the time (next month). I know that is a lot of money.

So, paying over £10k on my Barclays card - risky - it could bounce, decline, fail, go wrong in so many ways, and I am wary. As I say, it is a lot of money. To be honest the most likely is they allow the cruise and then block my card without telling me and make my life difficult when I want to buy a coffee.

But I have my shiny new Starling Bank card, and I asked them, back in December, if there are any spending limits using the card. I was advised of top up, and ATM usage limits and told that otherwise there was no limit. I asked at the time as we were sorting a rather expensive car for my son, and wanted to ensure it worked. Sadly Tesla don't take debit cards (WTF?) so was not the issue. Seems it would have been if they did!

I have spent the last 6 months thinking my Starling card had no spending limit, so I decided the safest tactic for this cruise was move the money to Starling, and then pay on card. They declined it! UNLIKE Monzo they do not log or show they declined it on the app. I had to ask on the chat thing. They declined as they have a £10k limit. It seems that previously they LIED TO ME about the limits, or lack thereof.

Now I find they can do nothing to fix this, and I cannot even send the money BACK to my Barclays account to try paying with the Barclays debit card as sending money out has the same limit! Before you ask, yes, I tried to resolve this with them before making a blog post and putting on twitter - had they resolved it, e.g. "I'll temporarily allow a higher level, try now", then I would have been impressed and not cross at all.

This is starting to be show stopping for use of Starling, and I will go back to Monzo for some stuff and Barclays for other. It really seems that these "challenger" banks are just playing around and not "proper" banks at all. Shame.

Anyway, the money, carefully collected together, is held to ransom almost, in my Starling account, and I do not want to lose the cruise booking over this. So I decide, that is OK, I can borrow from my mortgage reserve for a few days. I am not above using my mortgage reserve for a holiday, that is what these things are for. What do I find?, well Barclays have broken the mortgage contract (IMHO) and reduced my reserve with no notice to only £1k available. What the hell? If we manage to get this cruise sorted it will be a miracle. So I'm threatening to sue Barclays now over that...

Seriously, do no "proper" banks exist?

P.S. I could not send the money back to another account (well not all of it) as they stated there was a £10k “in any 24 hours” limit. However, experimenting, you can simply send more than one payment in a row. So yet more misinformation.


What would help is:-
  • Clearly stating actual limits in the app like Monzo do,
  • Ensuring staff understand and can explain them correctly.
  • Allowing customers to change them to suit their spending, ie £10k is way too high for a lot of people who would be happier with a much lower limit
  • Allow time limited pre-advice of large payment via app with face/finger security, and password, and PIN or whatever.
  • Please have the app show when a card is declined, and the reason, like Monzo do!
  • Maybe even a link/button to "enabled this transaction if you would like to try again in next hour" restricting to exact amount and merchant to exceed a limit...

30 comments:

  1. My experience of community accounts with Metro is that 'new concepts in banking' mean treating the customer as an annoying nuisance just like the old banks did.

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    Replies
    1. Yes, except they do it in an exceptionally smarmy and condescending way, sir.

      Delete
  2. Just a single anecdote but I've found Lloyds Bank very reliable and their procedures in that area very agreeable. They do occasionally decline a debit card payment because some risk algorithm doesn't like it (I suspect every single bank does the same) but:

    1) They usually send an automated text within a few minutes to ask if was really you making the transaction and you can just text back to confirm and then they'll accept it if you retry the transaction.

    2) If they don't send the text for whatever reason (I'm not sure if they'd do that for very large amounts) you can call the number on the back of the card and go through a little security procedure where they ask questions about your recent transactions and they'll authorise it. It usually takes ~10 mins including waiting on hold, but the fraud department people are professional and are available 24/7.

    ReplyDelete
    Replies
    1. Downside: if you used Lloyds earlier you might find yourself hived off into TSB (Total System Breakdown) and in a world of shit. Also, like more or less every other non-fintech bank, they are using a horrific monster of computing machinery that more or less staggered out of the 60s like the living dead, has almost nobody left who understands it (most of the original authors being fired almost as soon as they wrote the system: it was written now, they weren't needed any more, we are finance people, not software people!), and has since been tormented by decades of mergers into something that just barely works.

      I expect more and more banking IT disasters, culminating -- if TSB doesn't give us this already -- in the worst of all disasters, the sort where the financial compensation scheme can't help because the bank hasn't run out of money due to the mismatch between the lifetimes of its assets versus liabilities but rather has *lost track of its balance sheet* and no longer has any idea what deposits people hold with it. How do you compensate customers of a bank that screwed its accounts and basic records up that badly? (Half of them will probably have switched to paperless statements as the banks have been imploring them to do, so will have *no* un-corrupted record of their debts and deposits at all.)

      Delete
    2. As opposed to fintech banks and pseudo-banks, which are typically running on some a whole bunch of standard packages glued together In The Cloud, but nobody can ever upgrade them because Bad Things happened last time we tried that.

      PHP is in there somewhere.

      So is Bitcoin. Whether they know it or not.

      Delete
  3. It’s a shame that bitcoin didn’t live up to the promise of putting the banks out of business.

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  4. I've had my main account with Nationwide for years and years (several decades) and they've never declined a payment. I've bought several cars and holidays around the £25K mark without even a query. Apart from this flawless performance, I like them because they're one of the few remaining mutual banks owned by their customers.

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    Replies
    1. Was the holiday £25K or thereabouts? How difficult was it to make the decision to spend thst much money in a holiday? I struggle to justify spending almost anything in a holiday these days, there are so many other competing priorities, how do you do it?

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    2. NCL do a wide range of packages, and some are expensive. When you have rich friends to help share the costs, is helps matters. And, well, you only live once.

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    3. Oh, and I don’t have a car, which saves quite a lot!

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    4. Nationwide are a building society not a bank. So they are owned by their customers not shareholders or private equity who are only interested in profits.

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    5. I spent £10K myself last year to go on a river cruise with my mum and aunt. They paid separately. Justification: you only live once, I'm single with no children, my older relatives won't be around forever.

      Delete
    6. Just to warn you I have had some unbelievable fuckups from Nationwide of the kind that would have Adrian leaving some very angry voicemails.

      E.g. I changed my address using the online "change your address" facility but it only changed it for my current account. Credit card statements and replacement credit card went to old address. They locked me out of my account for security reasons and I had to figure this out by myself.

      Also, I have had payments declined on holiday in America after messaging them telling them I was going on holiday to America.

      Those are just the incidents I was offered compensation for.

      I know someone who works for them and in IT terms it's as much of a shitshow as any high street bank.

      Delete
  5. I tend to use an AMEX charge card, I think it's only ever declined once, quick phone call and it was resolved. Also charge backs are quick and painless the odd time I've had to do it.

    Recently made a payment to a hotel in Mexico for 15k, went through without issue.

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  6. Amex, they seem to get it, when things go wrong (fraud or useless supplier) the problem is solved with minimal fuss. Wherever possible all of my spending goes through them, decent credit limit which covers this level of spend, and Avios points which are handy.

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  7. Top up your Monzo account using the Starling card and transfer the dosh that way. Obviously 2-3 transactions due to limit...

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  8. I have had no problems at all with citibank. I bought a car on my debit card for 20 grand a year or so back and it all just worked. I did tell them beforehand though. Their web site sucks but you can't have everything. They do what they say on the tin.

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  9. Sadly Tandem seem to be just as arrogant: they insist that your card must be contactless whether you want this stupidly insecure facility or not. I defeated it by punching a hole in it, but I wasn't favourably impressed.

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  10. Surely your credit card(s) have limits way north of £10k ? And you'll get Section 75 protection too which you won't get when paying by debit card.

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  11. Don't try doing it with Monzo as they have the same daily card transaction limit, just in case you weren't aware.

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  12. It's a problem.

    The ATM, payment and send limits make sense in terms of risk to the admittedly small organisations. However would it be particularly difficult to have the App notify of payment failure, and then request the user allow/whitelist the next attempted transaction for that amount?

    Seems to me that would reduce the risk and satisfy the customer.

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  13. It seems to me that the whole payment card thing is ridiculously insecure anyway. Those PCI DSS standards go to ridiculous lengths about encryption but seem to forget thst scamming someone is as simple as having a 16 digit number which by the way they pass about over the phone willy nilly. No passwords or anything needed, just a 16 digit number. I’m amazed the banking system hasn’t collapsed already due to fraud!!!

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    Replies
    1. Not sure the panic as much over scam emails and stuff as that is likely the banking customer being defrauded and not the bank. They can blame the customer for lax security.

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  14. Use a proper credit or charge card. You'll get section 75 protection and either cashback or a pile of airline/hotel miles.

    If the merchant only accepts debit cards, I've had zero problem using First Direct for debit card transactions of up to 50k.

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  15. If you think UK banks are useless try France. They have ridiculously low limits on debit card spending (I think it's 1700€ a *month* on my French account), are often regional franchises so if you bank in Normandy, don't expect a branch of notionally the same bank in Brittany to be able to help you with anything and they have an attitude to customer service straight out of the 1970's

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  16. Metro Bank sounded promising when they first started, but apart from long opening hours at their limited number of branches (sorry, 'stores') most of their USPs were gimmicks such as allowing dogs.

    I ditched them when their debit card's 'No Foreign Loading Worldwide' turned out to have been 'Bait and Switch' because they then restricted it to Europe.

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  17. You got further than we did. Despite their promise of same day account opening, after a week of fannying around, and of generally poor customer service including the branch manager leaving early despite having scheduled an appointment with us and the business manager skulking out the back and refusing to engage other than statements issue to other staff members to pass on to us, we abandoned our application with Metro. We were utterly unimpressed.

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  18. So what's the problem with Monzo? I use it for everything now, including where my employer pays my salary and I think it's great!
    Yeah ok it has spending limits that big banks don't always have but I think they are a sensible precaution to reduce losses in the even of fraud.
    Would be nice to have the facility to temporarily increase limits when needed mind.

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    Replies
    1. I think monzo will if you ask them for individual transactions. They have made noises to that effect on their forums.

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