Bank Of Ireland Cuts SSIA Rate from 4% to 1.7%

Sponge Bob

Another bank ripoff.

http://www.rte.ie/business/2005/0510/SSIA.html

They did it without telling anyone but were forced to write to the 30,000 odd affected customers and tell them before they could implement the change.

As the base rate is 2% its a nice little earner for the bank considering how big the average SSIA is by now, c €10,000 or so.

I doubt if the 30,000 punters will be in a hurry to reinvest that matured SSIA with B o I no nmater how many of their salesmen recommend you their PIPs and PEPS

rondjon

It's unfortunate that every time something like this comes up, everyone always rushes to the attack of "rip off Ireland".

The simple facts here are that the small print said that if you started on some amount of SSIA contribution, that you could max out in YEAR 1 and get the same headline rate.

If you maxed out in YEAR 2 onwards, they would only give you a certain amount above ECB rate.

So, for those that are complaining, essentially they're putting their hands up saying "hey, look at us. we're stupid and we don't read the small print".

BOI don't have to back down on this, and only because the communciated this in a haphazardly manner that they are backing down.

It's not a rip-off. It may be sharp practice, but there was enough information in the SSIA contract for people to know about this before they signed up for it.

As a consumer, if you don't look after your own interests (read the small print) how can you expect the government or other people to look after you.

sceptre

Mmmm, indeed. They're still getting their 25% freebie though aren't they? Effectively worth more towards the endgame as well.

Gillo

rondjon wrote:

As a consumer, if you don't look after your own interests (read the small print) how can you expect the government or other people to look after you.

Reminds me of the Eircom share complaints when people read "You're gonna make loads of money as the share price rises" it's funny cos when I read the advertisements it read "Your share price may rise and fall".

People just love to moan if they don't make the maximum possible return, it's always easier to balme someone else than accept you are not making a fortune.

Morgans

I dont think it is anything like the Eircom whingers.

Anyone who thinks that the bank is out for the customer is living in a different reality to the one we have today, and anyone who defends the banks who use small print to provide themselves with loopholes is obviously taking the obscure point of view. (the general public are fools and anyone with intellegence should know exactly what's going on) Anyone who thinks that we ar getting a fair service from the banks is also wrong, we are getting the service that we deserve for not doing more to have competition in the market. BoS needing to buy ESB shops to get a presence on the street. If you have a big enough account, you will be OK though.

Contracts are written to discourage people from reading them fully. Those drafting the contract know that, the banks know that. Write an email to the CEO of the Bank of Ireland, 4 pages long in font size 6, and see how far down the mail he gets.

Why is in small print, when it clearly important. Becuase the small print says, everything written in large print is a load of bolix, which we can reverse whenever we want without your permission, does that make it okay?

To some people it clearly does.

Sponge Bob

Morgans wrote:

Becuase the small print says, everything written in large print is a load of bolix, which we can reverse whenever we want without your permission, does that make it okay?

To some people it clearly does.

Very well put, in 'reality' it is always a case of

"Terms and Conditions will apply so feck off"

and not

"Terms and Conditions may apply"

like the ads say.

This time the Bank probably looked at the original ads and T&Cs together, thought about the IFSRA and had to concede the 4% for 3 or 4 years gone past, only applying the reduction to the final 1 or 2 years.

It also appears that Joe Duffy had eaten them before my original post on the matter

bonkey

Sponge Bob wrote:

Very well put, in 'reality' it is always a case of

"Terms and Conditions will apply so feck off"

and not

"Terms and Conditions may apply"

Even more reason to read the small print rather than complain about not having read it claiming one was ripped off.

Honestly - this reminds me of the Eircon fiasco, with political parties and others suggesting that people had somehow been done when the shareprice dropped, and they should get some form of reimbursement because they didn't understand the basic warning of "share prices can go up or down".

It also appears that Joe Duffy had eaten them before my original post on the matter

Oh, well, they must be in the wrong then.

BOI made a right balls of informing the customers of what ws going on, not of informing them upfront of what could happen. For that, they got (rightly) criticised, and they decided to back down as a gesture of goodwill.

But the actual dropping of the rate - they did nothing wrong and ripped no-one off.

jc

Morgans

You are dead right on dropping the rate. They are allowed to do - it says in the small print - yet it is called the Fixed rate option. But if you think dropping the rate was anything other than a method of keeping money from the punter and placing it into the banks coffers then you are very misguided indeed. I understand that banks are only a company that sells money and financial related products, and not here for us as a parnter.

In an open marketplace, the bank taking this action could be punished by taken the account elsewhere for a better interest race. However, the customer cannot move the SSIA account, the customer cant even reduce the amount inputted into the SSIA, at this stage without forfeiting a onerous percentage of their savings. It says so in the small print.

Those who spend their time deciphering small print for each contract they sign in for, for each action they take, will spent little time doing much else. Small print is the biggest loophole that is used by banks. You will never see small print working on the side of the consumer. In fact, next time I sign a contract, I will draw up my own list of small print loopholes.

RainyDay

Morgans wrote:

In an open marketplace, the bank taking this action could be punished by taken the account elsewhere for a better interest race. However, the customer cannot move the SSIA account,

Not true - it is possible to switch your SSIA to another provider, though it's not easy to do this.

Morgans

Why isnt it easy?

Do you know anyone who has switched?

Do you incur penalties for switching, which is what I said, had the entire sentence been copied and quoted?

bonkey

Morgans wrote:

yet it is called the Fixed rate option

Check out what a fixed-rate option on a mortgage means

Indeed - I challenge you to fnid the term Fixed Rate being used in a bank for anything where Fixed actually means doesn't ever change.

But if you think dropping the rate was anything other than a method of keeping money from the punter and placing it into the banks coffers then you are very misguided indeed

I dunno about others...I fully expect thats what it was. Banks are bussinessses. They exist to make profit from their customers. So when I become a customer, I expect them to make profit from me. If I have a problem with that as a base concept, I shouldn't deal with them. If I accept that they will do this, and don't bother checking how they make their money from me....well....

Morgans wrote:

Those who spend their time deciphering small print for each contract they sign in for, for each action they take, will spent little time doing much else.

Its a cost-benefit problem. You trade cost (time-investment) against benefit (getting the best deal).

For small issues, I'm generally willing to web-search some opinions, check some consumer-watchdog sites/mags, maybe ask some ppl who I know have personal opinion. If I don't get the best deal...I don't mind...I generally avoid getting utterly ripped off.

For larger issues, I invest more time, because the cost of getting it wrong is greater.

Would you sign a mortgage for (say) half a million without investing time in the fine-print? At that stage, getting it wrong could be so costly that you'll consider paying someone else (presumably more qualified) to read it for you.

Personally, I don't want a McWorld, where I can walk in to any McVendor, and order a McProduct, safe in the knowledge thats its effectively indistinguishable from every other equivalent McProduct available from every other McVendor. No matter how I look at it, when I have choice, I can make it from an informed or uninformed position.

Ppl who invest large sums of monies and who don't read the fine-print have - in my opinion - no comeback. They didn't care enough at the outset about this particular issue to invest the time, so tough noogies.

jc

Morgans

i understand what a fixed rate means in banking terms. I was being facecious.

I am very concious about being ripped off, and I have my own concepts of value. I will not spend money where I beleive that I am being ripped off. Banks want to be treated as businesses, it what I have been saying, they sell money and financial products, no different from any other retailer. They no longer portray themselves as helpers - the ad where the bank manager says - when you make money, I make money. There is nothing wrong or immoral with this.

I dont have a problem with Ryanair saying that they cant guarantee that their flights will arrive on time in the small print, and those who complain about it should know better.

However, the product that you are getting should be clear, information such as the price of your flight may change before you arrive at your destination, should not be placed in small print. The price that you order a product may change, up or down, before you pay for it. It should not require the consumer to search for that information. Why is it placed in small print. A loophole, that gives the bank leeway to screw a little more money out of its consumers, realising that its their own adminstration and bureaucracy red tape that prevents easy movement of the consumers goods, (money in this case) to a rival business. Thats all. Your opinion is what the bank will defend itself each time, they can stand up in a court of law and with, it doesnt mean that it is right as is proof of a lopsided business environment.

Stix

Isn't there some sort of form you need to have filled out in order to claim your SSIA money ?

I heard something recently and have an article at home somewhere, but never got round to reading it.

Sponge Bob

At the very least the BoI product, sold as fixed, was a partially fixed product at best . Therefore the advertising way back when was misleading . The Bank had to take the hit for their misleading advertising as I see it. The customer will take the hit from now on (1-2 years)

RainyDay

Morgans wrote:

Why isnt it easy?

Because the bank needs to go through a bit of a rigmarole with Revenue to track any switches, therefore the banks aren't really interested in accepting incoming transfers - more hassle that it's worth.

Morgans wrote:

Do you know anyone who has switched?

I don't know him personally, but Marco from askaboutmoney.com reported a successful switch in this thread.

Morgans wrote:

Do you incur penalties for switching, which is what I said, had the entire sentence been copied and quoted?

No - no penalties involved. And just to be clear, you did specifically state that the customer can't switch their account, which is not true. The remainder of your sentance did not qualify this untrue claim at all.

Morgans

Thanks very much for the link. I stand corrected.