Pricewatch: Readers’ queries
This week a Dutch man in Ireland vents about our banking and insurance practices, and another consumer has a concern about discounted utility contracts
KBC’s Irish headquarters in Dublin. Photograph: Bryan O’Brien
Irish banking and insurance are double Dutch to some
He asks why our banks are “stuck in the 19th century. I’ve recently switched from Bank of Ireland to KBC because they said they were going to do things differently, but it’s all still the same. For a start, when I switched, for some reason my standing orders had to be switched off at Bank of Ireland a week before they came into effect at KBC. Why? It got me into trouble with a weekly standing order for child maintenance,” he writes.
“A few weeks later I was in trouble again, because, without notice, the standing order wasn’t processed on Good Friday but instead the Tuesday after. When I asked KBC why, I was first told that Good Friday is an official holiday, then that it’s a bank holiday, and then that it’s not a holiday but not a banking day either. They told me standing orders are processed manually. Then they that changed that to state that they are processed automatically. All of which doesn’t explain why the computer couldn’t wire my money across on Good Friday.”
That is not all. He wanted to move his savings account. “The best savings account is one that accepts lodgments by direct debit only, which meant I couldn’t lodge the balance of my old savings account as part of the transfer. Instead I had to set up a direct debit for €1,000 per month until the balance had been transferred. Then, when I went to the bank to change the amount down to €200, I had to write my request on a blank sheet of paper. No form, no way for the bank staff to make the change, only a handwritten request would do. How last century is that?”
After all that, the change took more than 10 days to be processed, resulting in his current account being empty, and as a result of that a direct debit couldn’t be processed, resulting in a charge of €10. “Not as bad as Bank of Ireland’s €12.70, but again this seems to be because everything is still manual in Irish banks.”
He then explains how this works in the Netherlands. “If I have a direct debit set up, and on the date the balance isn’t in the account, nothing happens. The computer will try again a few days later, and if the balance is there then it’s processed. No fee or charge or penalty for anyone. If after a few attempts the direct debit still can’t be processed, then the receiver is notified and they can sort it with the account holder. No penalties.”
Ronald is not finished. “Online banking is a joke. Why can’t I simply enter an Iban, a recipient name and an amount for a one-off payment like I could in Holland? Instead I have to set up a payee, set a fixed message, get a confirmation code to my phone and then I can make the payment. I love security, but why is my account number not on my bank card? Why can’t I even see my own account number in online banking? I can only imagine that it’s to do with the level of security at the bank.
“I shouldn’t have to worry about somebody having my account number and my name. If someone wants to transfer money to me they would need those details – that shouldn’t allow them to get their hands on my money.”
Then there is insurance. “When I first transferred my motorbike insurance to Ireland, I was asked how many years no-claims I had. I answered 17.” His insurance company then said they wanted the number of years on his no-claim statement, so again he answered 17. “Oh, but here we only count as far as six,” he was told.
“In Holland you reach maximum no-claims discount after six or seven years, just like here. The difference is that they keep counting the years. If you’ve had 15 years without a claim, then your first claim doesn’t drop you down to zero years and no discount. Instead you would go from 70 per cent to 60 per cent, and one or two years later you’d be back up to the maximum.”
There is still more. “Another interesting difference I found out recently after an accident. When you have third-party insurance and you’re involved in an accident that wasn’t your fault, you’re left to deal with all of it yourself. In Holland the insurance company takes care of you in that case and will claim all the costs back from the other party’s insurance. The result is a more efficient system, and it’s cheaper too. Rant over.”
An electric shock
Colette Sims from Limerick has been in touch to ask if Electric Ireland is allowed “not to notify consumers that their discounts are discontinued after 12 months if the consumer does not contact them in advance? They say it’s in the terms and conditions, but after 12 months I had forgotten.” This practice is employed by all the utility firms. Discounted electricity or gas is available only for a short time; it is worth switching and switching again to save money. Bonkers.ie is handy for finding out where the best value is at any given time. Electric Ireland told us that when a customer signs up to a discounted plan, “they are notified in the terms and conditions that they will revert to the standard rates after the contract [is up]. The same approach is taken by other suppliers.”