Natwest and RBS horror: where do you stand?

Natwest branch opens on SundayMartin Rickett/PA Wire/Press Association Images

It has been a horrible weekend for many Natwest, Ulster Bank and Royal Bank of Scotland customers, dealing with the fallout from the computer glitch that brought banking to its knees.

So what is going on now, when will it be back to normal, and will there be any compensation?

Glitch

The problem kicked off when the Royal Bank of Scotland upgraded its software on Tuesday. Customers began to find that payments had not been made to their accounts, and as more and more people started to find their accounts had run dry, a full scale crisis erupted on Thursday.

Immediately there were serious problems, as many people only discovered there was a problem when their card was refused. One customer reported having to leave his car at a petrol station and walk three miles to borrow money from a friend. In one striking incident, a house-buyer spent Thursday sitting outside her new property with her fingers crossed, waiting for funds to clear, only to have to leave her worldly goods in the van and become homeless for the short term. Meanwhile thousands faced a host of inconveniences, from having to borrow money for their return journey home after work, to having to go without lunch.
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Outrage

NatWest received a great deal of criticism for the fact it took until Thursday afternoon for a formal response. Since then, they have stepped up their game.

Natwest took some steps in an effort to help customers who found themselves in dire straights over the weekend. They opened some branches, including 1,200 on Sunday morning, and they doubled the number of callcentre staff to deal with problems. Those who could get to an open branch were able to withdraw cash. And some of those who got through on the phone were able to secure an interest-free emergency overdraft to keep them solvent until their cash cleared.

Stephen Hester RBS Group Chief Executive also issued a statement on Saturday evening, apologising and saying: "Our customers rely on us day in and day out to get things right, and on this occasion we have let them down. This should not have happened." He said staff were working around the clock to sort issues out.

Horrors

However, there are plenty of stories of those who were still unable to get any joy from NatWest - including those who were not within striking distance of a branch and had run out of credit on their phone.

The NatWest website has been inundated with complaints from customers One wrote that because his wages haven't cleared he has had no electricity for three days. Another who has been unable to collect her benefit money reported yesterday that she was now running without gas, electricity or food for her children.

Others don't bank with Natwest, but have suffered the knock on effects, and now there are stories of people who have had bank charges from their own banks because their employer banks with Natwest and their salary has not been paid in.

So where are we now?

The good news is that the technology has been fixed. The bad news is that the huge backlog of payments will take a while to clear. Susan Allen, Director of Customer Services, RBS Group, said this yesterday: "I can confirm that we are making progress to clear the backlog of payments and I'm cautiously optimistic that RBS and NatWest customer account balances will be largely back to normal from tomorrow.The knock-on effects of this technical failure mean there will bumps in the road. We will do everything we can to minimise further disruption to our customers. And we continue to rely on and appreciate their patience as we work through possible disruptions."

It isn't guaranteeing everything will work swimmingly from here on in, but there is a good chance that those whose finances are hanging by a thread will be able to light their homes and feed their children one week after the problem first emerged.

In the interim, the bank has promised that from tomorrow until Friday this week, 1,200 main NatWest and RBS branches will be open from 8am to 6pm to help deal with customers' problems.

Compensation?

There have been calls for compensation. There are plenty of people who have posted their view on the Natwest site that given that they are charged for every day their funds are insufficient, the bank should be made to pay a daily charge to customers too. Which? has confirmed that it will be producing a guide to help people make a compensation claim.

Natwest has gone so far as to say it will ensure no-one loses out in the long run. Allen says: "I can confirm today that we have started the process of putting things right for our customers. We will automatically waive any overdraft fees or charges on current accounts. This will be processed over the next few days."

And for those worried that the last few days will have damaged their credit score she says: "We will work directly with credit agencies to ensure no one has their credit score affected. For all other issues, customers have our commitment that they will not be out of pocket from this issue. We will publish further details on how we will ensure this later in the week."

If you are having any kinds of problems, then it's worth getting in touch with your bank, either at your nearest branch, or through the call centre - which is open 24 hours. If you want to avoid paying through the nose for these calls you can use the non-premium-rate numbers: NatWest 0161 451 7551; RBS 0161 930 8666; UlsterBank 028 9053 8046.

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Natwest and RBS horror: where do you stand?

More than 46,000 of 106,000 the complaints received by the FOS in the second half of last year related to payment protection insurance (PPI). And the organisation is expecting to receive a record 165,000 PPI complaints in 2012/2013.

The huge numbers are due to the PPI mis-selling scandal that should now be a thing of the past, but there is no doubt that the insurance, which can add thousands to the cost of a loan, is highly unpopular!

(Pictured: Martin Lewis after the PPI payout ruling)

Complaints about mortgages jumped by 38% in the last six months of last year, the FOS figures show, compared to an increase of just 5% in investment-related complaints.

Common gripes about mortgages include the exit penalties imposed should you want to sell up or change you mortgage before a fixed or discounted deal comes to an end, and the high arrangement fees charged by many lenders.

While there is nothing in the data released by the FOS about the number of complaints relating to savings accounts, hard-pressed savers have been struggling with low interest rates for several years now.

You can get up to 3.10% with Santander's easy-access eSaver account, but many older accounts are paying 1.00% or less and even this market-leading offer includes a 12-month bonus of 2.60% - meaning that the rate will plummet to just 0.50% after the first year.

Banks are imposing the highest authorised overdraft interest rates since records began, with today's borrowers paying an average of 19.47%, according to the Bank of England.

A typical Briton with an overdraft of £1,000 is therefore forking out around £200 in interest charges alone. Coupled with meagre returns on savings, it's enough to make your blood boil!

While authorised overdrafts may seem expensive, going into the red without permission will cost you even more due to huge penalty fees.

Barclays, for example, charges £8 (up to a maximum of £40 a day) each time that there is not enough money in your account to cover a payment.

If you need to send money abroad, the likelihood is that your bank will impose transfer charges - and offer you a poor rate of exchange. Someone transferring a five-figure sum could easily lose out by £500 or more as a result.

The good news, however, is that you can often get a better deal by using a currency specialist such as Moneycorp.

Automated telephone banking systems, not to mention call centres in far-flung parts of the world, are one of our top gripes - especially as we often encounter them when we are already calling to report a problem.

In the words of one disgruntled customer: "What is it about telephone banking that turns me into Victor Meldrew? Well, maybe it's the fourteen security questions, maybe it's the range of products that they try to push or maybe it's because I'm forced to listen to jazz funk at full volume while my phone bill soars.

"Actually though, I think it's because the people I eventually speak to rarely seem able to solve the issue I'm calling about."

The days of a personal relationship with your bank manager are long gone - for the huge majority of us at least.

When ethical Triodos Bank investigated recently why around 9 million Britons would not recommend their banks to a friend or relative, it found that almost a third felt they were not treated as individuals. Another 40%, meanwhile, were simply disappointed with the customer service they received.

When you're in a rush, the last thing you want to do is wait in a long queue at your local branch.

Researchers at consumer champion Which? recently found that most people get seen within 12 minutes, but you could have a much longer wait if you go in at a busy time. Frustrating stuff!

The Triodos Bank research also indicated that the bonus culture that ensured the bank's high-flying employees received large salaries, even when it was making a loss at the taxpayer's expense, was hugely unpopular with consumers.

About a quarter of those who would not recommend their current banks said this was the main reason why. And with RBS executives sharing a £785 million bonus pool despite the bank, which is 82% publicly owned, making a loss of £2 billion last year, it's not hard to see why.

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