Money News: OFT gets banks to speed up their act on cheques
Sunday 19 November 2006
Banks are to clear customers' cheques within set time limits under a new deal with the Office of Fair Trading.
At present, cheques typically take three days to clear before interest is credited and cash can be withdrawn.
But under new rules due to come into force in November next year, money deposited in any account will start to earn interest - or will count against overdrafts - within two working days.
Account holders will be allowed to withdraw funds from a maximum of four working days after the cheque is deposited.
And, unless the payee is a knowing party to fraud, financial institutions will have only six working days in which to take money deposited by cheque back out of an account. In other words, a cheque won't bounce after six days.
These changes - to apply to all accounts, including "basic" bank accounts - were agreed by the Payment Systems Task Force, an industry review body set up by the Office of Fair Trading. The task force concluded there was no case for a "complete rebuild of the cheque clearing system".
Cheque use is falling by 8 per cent a year, and other changes proposed earlier this year will speed up electronic payments by internet or phone - methods commonly used in preference to cheques. By late 2007, funds being transferred electronically should reach bank accounts on the same day the customer deposits them.
The move was welcomed by consumer bodies.
"Britain's centuries-old cheque-clearing system has for too long been slow and confusing," said Philip Cullum from the National Consumer Council. "This will benefit many customers, offering them greater certainty and better service."
Energy: British Gas ads ruled 'misleading'
British Gas has come under fire from the Advertising Standards Authority for a "misleading" claim in its adverts.
The adjudication follows a string of television and press ads that said: "Every 60 seconds, someone switches back to British Gas".
In Scotland, the same claim was made in reference to British Gas's subsidiary, Scottish Gas.
A member of the public queried the ad after calculating that its claim amounted to more than 526,000 people per year, which he believed was an exaggeration.
Rival supplier ScottishPower also made a challenge. Having won plenty of business from customers switching away from Scottish Gas, ScottishPower said it believed there were insufficient numbers of customers remaining to support the company's claim.
Following these complaints, the advertising watchdog launched a probe.
British Gas provided figures that showed the number of new energy customers (signing up for gas and/or electricity) it had registered across the UK during 2005 and so far in 2006 averaged out at two new energy contracts every minute.
But after investigating, the ASA ruled the 60-seconds claim was misleading as it included new customers and not just previous customers returning to British Gas from other providers.
The gas giant acknowledged that the figures included people who had not previously been British Gas customers and could not be described as "switching back to British Gas".
The ASA ruled that the adverts should not be published or broadcast again in those forms, "unless there is sufficient substantiation to back up the claims made" (see Comment, page 19).
British Gas offered to change the tagline to say: "Every 60 seconds, someone switches to British Gas".
Communications: Broadband deals 'failing customers'
The launch of "free" broadband has led to a "customer satisfaction freefall", according to a new report from price-com- parison service Uswitch.
Its findings highlighted how fierce competition and falling prices have not always led to better service over the past six months. Overall, customer contentment levels have fallen by 9 per cent among broadband users and 4 per cent among home phone users.
There are now 11.7 million broadband and 23 million home phone customers in the UK. Many get both services from the same company (often as a condition of the "free" broadband deal), meaning that they are more likely to have cause to speak to their customer services department.
Virgin.net came top in the broadband study, with 85 per cent of its customers satisfied with the overall service they receive. Languishing at the bottom, each on 70 per cent, were Orange and TalkTalk - both of which have launched free broadband products this year.
In the home phone market, Tiscali overtook TalkTalk to take first position with 81 per cent overall customer satisfaction, but both providers have experienced a sharp fall in ratings since March. NTL came bottom, with a third of customers dissatisfied with its phone service.
Uswitch spokesman Steve Weller said the fall in overall satisfaction levels among home phone users was a direct result of the converging market. "The probability that consumers are coming into contact with customer services on a more regular basis has increased significantly as the developments in the industry raise the likelihood of more and more people signing up for bundles with a single provider."
Mr Weller said the arrival of low-cost broadband deals had boosted the number of subscribers by nearly 650,000 since March. "But it is disappointing to see the majority of providers failing to accompany the growth in customer numbers with sufficient growth in customer service operations and the required investment in their technology to ensure they are looking after customer needs."
Consumer trust in suppliers, he added, was at an all-time low.
"The worst-performing category across both the home phone and broadband reports was the lack of certainty that suppliers are ensuring customers are on the best available deal."
- 1 The BBC has just done more to eradicate ‘terrorism’ than all our wars since 9/11
- 2 Does the path to true love really lie in these 36 questions?
- 3 Saudi preacher who 'raped and tortured' his five -year-old daughter to death is released after paying 'blood money'
- 4 Presidential optical illusion offers clues to how brain processes faces
- 5 Roald Dahl letter warning student to 'eschew beastly adjectives' rediscovered after 35 years
'We would evict Queen from Buckingham Palace and allocate her council house,' say Greens
French court convicts three over homophobic tweets, in case hailed as a 'significant victory' by LGBT rights campaigners
Greece elections: Syriza and EU on collision course after election win for left-wing party
British Muslim school children suffering a backlash of abuse following Paris attacks
British grandmother Lindsay Sandiford faces execution by firing squad in Indonesia
Louise Mensch says 'F**K YOU' in explosive tweets about David Cameron, Saudi Embassy and the Queen over King Abdullah tributes
iJobs Money & Business
£16500 - £16640 per annum: Recruitment Genius: This fast growing Finance compa...
£30000 - £32000 per annum + benefits : Ashdown Group: A highly successful, int...
£18000 - £20000 per annum: Recruitment Genius: This rapidly expanding business...
£25 - 28k + Bonus: Guru Careers: An In-house / Internal Recruiter is needed to...
Day In a Page
Hibernate during winter and make your living during the summer at this busy guesthouse with panoramic sea views, in the village of Lynton
A four-bedroom penthouse next to the Tate with direct views of St Paul's from two floors of luxurious living space
A four-bedroom detached home surrounded by spacious gardens and woodland, close to New Pudsey
An 18th-century, three-bedroom home near Langstone Harbour built from ships beams with vaulted ceilings and wood burning stoves
A five-bedroom semi-detached home with a mix of period and modern features in a popular and convenient location
This five-bedroom red-brick beauty overlooks the village green and sits in just under two acres of land
A three-bedroom villa with self-contained flat, minutes from Lake Windermere
A deceptively spacious, beautifully presented Georgian home with 3000sq ft of living space and five reception rooms
A five-bedroom Victorian home with four receptions, superb gardens and paddock in Pembury
An eight-bedroom house on the south side of the The Green with cinema, wine cellars and summer house
This 17th century beauty is full of rustic cosiness, while the detached home office means you can also run a business
Four exclusive apartments in a Grade II-listed former medical school with 2,275 sq ft of living space and 18ft ceilings
A five-bedroom terraced house on the popular Peterborough Estate, ideally located for both Eel Brook Common and South Park
A state-of-the-art farm-building conversion on the former Cliveden Estate, with 11,420sq ft of internal space, cinema and wine cellar
A three-bedroom, 15th-century cottage with original features in the picturesque village of Sissinghurst
A six-bedroom terraced house with large south-facing roof terrace, cinema room and wine cellar
A new seven-bedroom home built in Queen Anne-style with swimming pool and parkland views in Mortimer
A listed, four-bedroom farmhouse in the rural hamlet of Rushall with detached barn, four acres of gardens and paddocks
A first-floor flat with two bedrooms, a spacious reception room and communal grounds in a leafy part of London
A three-bedroom flat with a spacious rootop terrace and balcony, accessed from a private gated courtyard
A Grade II-listed pile with six bedrooms, stables and 39 acres of grounds in Standlake
A two-bedroom flat with boutique hotel-style interiors, close to the foodie haunt of West End Lane
A two-bedroom flat in a beautiful old vicarage, with many original features, close to the city centre
A three-bedroom 16th-century home with an aga kitchen, private gardens and heated outdoor pool, in Hadleigh
A three-bedrom home in sought-after Queen's Gate Mews, with Italian marble-finished bathrooms
Surrounded by glorious countryside in the village of Udimore, sits this impressive four-kiln oast and barn conversion
A five-bedroom house in the picturesque village of Kettlewell, north Yorkshire
An 18th-century former coaching inn with original staircase, open fireplaces and beams throughout
A Grade II-listed Georgian town house with three bedrooms and a south-facing courtyard, near Arundel Castle
Feel on top of the world at this über chic penthouse on the 37th floor of one of Europe’s tallest blocks.
A Grade II-listed Victorian villa with six bedrooms and two further cottages, all with spectacular sea views
A grade II-listed, Georgian cottage with mature 50ft garden, perfect for summer entertaining
A magnificent Georgian pile with turrets, seven bedrooms, a heated pool and four acres of gardens
Fairoak Farm has five bedroom suites, gym, outdoor swimming pool and golf course
Chic two-bedroom river-fronted flat with a private lift that delivers you directly to your home
A spectacular seven-bedroom Tudor pile, once owned by Henry VIII, with 18 acres of land
A seven-bedroom Georgian property previously used as a picturesque wedding venue
A split-level flat in a church conversion with two en suite bedrooms and 1,200sq ft of living space
A three-bedroom bungalow situated behind an impressive stone wall, £645,000
Windsor Castle overlooks this three-bedroom Victorian cottage located on one of Windsor's smartest roads
Chapel House is a former vicarage with nine bedrooms in the beautiful Upper Wye Valley
A five-bedroom B&B and separate owner's accomodation with potential for conversion
Enjoy summer by the Thames in this two double-bedroom converted warehouse in Rotherhithe village