Questions Of Cash: 'Should NatWest have refunded my overdraft charges?'

Q. I wrote a cheque for £900, which was picked up by the payee on 10 March. It was cashed and cleared from my account on 12 March. I made out the cheque on the basis that I understood it takes three to five days for it to clear: in this instance it took only two. If it had been cleared on the third day the funds would have been in my account. I was outraged to find that NatWest bounced my cheque and charged me £38 for doing so. NatWest then put the cheque through again, without notifying me and this again put me over my overdraft limit. But I only went over my overdraft limit because of the £38 charge. I had been unable to get to my bank branch to put more money in as I was studying for my masters/diploma and holding a job. My time is very valuable to me and I have found this whole experience to be very inconvenient and infuriating. It is utterly disgusting that the bank thinks it is acceptable to charge a customer so much money for its incompetence. NatWest says it will only refund the charge if there was an error by the bank – which, it says, there was not. Is it acceptable for NatWest to clear funds from my account after only two days? Should it have shown some professional judgement and understood that I had money coming into my account the following day? AK, Dartford.

A. It is you that is in the wrong, not NatWest. You should have the funds to cover in your account, or an overdraft approval, when you write a cheque. You can never be certain that anticipated deposits will arrive or be cleared in time. NatWest has investigated your complaint again and has come to the same conclusion as before that it acted correctly. A spokeswoman for NatWest says: "The funds would be debited from [the reader's] account the day that the payee deposits the cheque into their bank account. It is the responsibility of the customer to ensure they have sufficient funds in their account when issuing cheques."

Q. I read the letter and response regarding the Aviva payout with interest (Questions of Cash, 1 August) – I am in exactly the same boat. I have a 25-year policy, maturing in September, which was supposed to pay out £30,000, but now has an estimated value of £25,750. Yet in each of the last three years I was notified that the termination value would be in the region of £29,000-£29,500. Surely it is not enough for Aviva to 'blame the markets'. It could have offered policyholders the right to move into cash in the last year or two of the policy life, to protect the vital final payout. Its failure to do so must surely amount to negligent mismanagement and cavalier disregard for policyholders' interests. There must be thousands of us in the same position. PB, by email.

A. "A year ago we did not know the market was going to crash," says a spokeswoman for Aviva. "We would have had to cancel policies and that would have lost them [the expected] growth." Had the policies been converted to cash at that time and the underlying investments continued to grow, Aviva would have been potentially liable for giving bad advice, she adds. Further, in your case, it would have converted a risk of failing to meet your mortgage liability into a certainty. Consequently the policy continued to maturity – by which time, because of the fall in share values, the deficit had, in fact, increased further.

Q. What is the cheapest and best way of taking money abroad on holiday? CC, by email.

A. One option which is cheap and limits your exposure to fraud is to prepay and preload a card for use abroad. Prepay cards are offered by FairFX, Caxton FX and Travelex. Exchange rates used by these card issuers are usually better than those offered by the banks. Fees are charged on cash withdrawals, but these are less than will normally be charged by banks for withdrawals on debit or credit cards. Most card issuers charge an exchange rate loading fee for use abroad. You can avoid this by either using the prepay cards or the Santander Zero or Post Office credit cards. Within Europe, the Nationwide debit and credit cards and Saga credit cards also do not charge an exchange loading. Worst of all, many card issuers charge per transaction, plus an exchange loading, as well as charging per cash withdrawal – it is important to check charges before you go away. Avoid making cash withdrawals on your credit card whether at home or abroad, as most issuers charge interest from the day of the withdrawal.

Q. I renewed my Vodafone contract in April 2008, at which time I was given a new phone. I was told I would be given three months' free insurance, but I asked them to remove this because I thought I might forget to cancel at the end of the three months. Vodafone tried to get me to take the insurance, but after I asked repeatedly they removed it. At the end of the initial three months the insurance was added to my contract without my knowledge or consent. I was charged for this until I eventually noticed it in July this year. I had paid for 15 months' insurance that I had specified I did not want. When I called Vodafone it agreed to remove the insurance, but would not reimburse me for the 15 months. I have since been offered a refund of six months' insurance, but I should get all of the payment back. GS, Berkshire

A. Vodafone has agreed to refund you the £120 for the paid insurance. You have resolved to check your bills more closely in the future.

Questions of Cash cannot give individual advice. But if you have a financial dilemma, we'll do our best to help. Please email us at: questionsofcash@independent.co.uk