Simon Read: RBS should not withdraw service from the vulnerable
Saturday 20 August 2011
Hard-up families were hit by a major banking blow this week. Royal Bank of Scotland - which owns NatWest - said it will ban customers with basic accounts from using cashpoints operated by other banking groups.
The bank's move is to save money and it rightly points out that Lloyds Banking Group - which includes Halifax - already restricts its basic bank account holders from using rival cash machines. But if RBS does enforce the ban, it could lead to all the other companies offering basic bank accounts doing the same, according to Nationwide.
It warns that the Bank's move could be the tipping point for other current account providers to follow. "When one player withdraws from the market it increases the cost burden on the others," says the building society's head of policy, Gary Follis. "It's not hard to see how this could quickly become a slippery slope, and if it does, it will be the poorest members of society that lose out."
If it happens it will be bad news for vulnerable people. Basic bank accounts are offered to people who otherwise wouldn't qualify for a bank account. They were set up by the banks - with some major government nudging - in the middle of the last decade to tackle financial exclusion. They don't allow overdrafts, but do give people on low incomes crucial access to basic financial services.
That access is important as it means they can pay bills electronically - saving money - and start to budget properly, rather than having to pay by cash. The theory is that anyone using a basic bank account may graduate to a full banking service in due course.
If they lose access to free cash withdrawals - a privilege enjoyed by everyone else - that would penalise them and make them second-class citizens. That is precisely the opposite of what should be happening to such people. The more they are treated as second-class citizens because of their low-income, the more they will stay on the fringes of society. And the recent riots show what can happen to those who feel excluded from the mainstream.
The average age a first-time home buyer expects to be when they can afford to buy a property is now 35, according to research issued today by the Post Office. Half a century ago the average first-time buyer was actually just 23. Is this trend towards young adults being a decade older before making a first step on the property ladder something to lament? I'm not sure that it is.
Buying a property is a massive investment and potential risk. Someone in their early 20s taking on the financial responsibility will quickly discover that the expense of maintaining a property – on top of massive mortgage costs – can outweigh the benefit, especially in light of the potential detriment to their lifestyle. The mantra that you should get on the property ladder as soon as you can is totally flawed when prices aren't rising, as is the case now.
For that reason youngsters strugglign to get on the mortgage ladder should concentrate on enjoying the advantages of renting. The key financial one is that landlords have to cover maintenance costs, which can be thousands in a year. But there's also a lifestyle advantage in that moving to a different rented home is much easier – as well as being much less costly – than buying a new home.
Shares: Is now the time to be greedy?
on thursday the Footsie suffered its worse one-day fall since the height of the credit crunch in November 2008. But the volatility could be a great opportunity for investors with spare cash to pick up some bargain shares, according to one financial expert.
"The opportunity to buy quality stock at great value doesn't come along very often and right now looks like a pretty good time to stock up on cheap shares," says Ray Black, IFA and Managing Director of Money Minder.
"Of course, there is every possibility that there will be even better bargains presenting themselves over the next few weeks and months but waiting for the botto' is a higher risk strategy that rarely pays off.
"Instead, I believe that recognising when buying opportunities present themselves and taking advantage of them whenever you can is a much better option for the majority. Therefore, in true Warren Buffett style, I find myself reminding investors to 'be greedy when others are fearful and fearful when others are greedy'."
Independent Partners; request a free guide on NISAs from Hargreaves Lansdown
Britain First criticised for using actress's memory to draw attention to their 'hate-filled home page'
Mark Dampier: Woodford’s young companies could be the stars of the future
Charges related to car parking rising and leading to serious money woes
You'll need £220,000 for a minimum wage in your retirement
Weekly Money: round-up of the personal finance stories you may have missed 20-24 October
The 10 Best money-saving sites
- 1 This 'woman calls police to order pizza' story isn't going where you're expecting
- 2 Axe wielding man shot dead after attacking four New York policemen on busy street
- 3 Watch what happened when food critics were unknowingly served McDonald's
- 4 Jimmy Carr's Oscar Pistorius joke goes a bit too far at the Q Awards
- 5 Ottawa shootings: Bruce MacKinnon's cartoon is the perfect tribute to soldier Nathan Cirillo
Of course, teenage girls need role models – but not like beauty vlogger Zoella
Cameron is warned 'no possibility' of UK reducing immigration and that bid to bring in quota on migrant workers would be illegal
Support for EU membership 'at highest level since 1991' with most Brits wanting to stay 'in'
Thousands with degenerative conditions classified as 'fit to work in future' – despite no possibility of improvement
Residents should throw a street party and mix with immigrant neighbours, councils told
Attacks on 'Ukip Calypso' show how skewed people’s priorities are
iJobs Money & Business
£60000 per annum: Ashdown Group: Compensation and Benefits Manager - Compensat...
£30000 - £35000 Per Annum plus excellent benefits: Clearwater People Solutions...
£24000 - £28000 per annum + bonus & benefits: Ashdown Group: IT Business Syste...
£50000 - £90000 per annum + benefits: Ampersand Consulting LLP: Markit EDM (CA...
Day In a Page
This 17th century beauty is full of rustic cosiness, while the detached home office means you can also run a business
This five-bedroom red-brick beauty overlooks the village green and sits in just under two acres of land
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
A one-bedroom, luxury apartment with private gym and concierge service in Moorgate
A four-bedroom house in Hermitage Gardens with three reception rooms and landscaped gardens
A seven-bedroom Grade II-listed property with a separate self-contained apartment
A five-bedroom Victorian house with three reception rooms and galleried landing, £695,000
A six-bedroom farmhouse with five acres of land in a former cloth-making village