/ Money, Technology

Banks call charges: customers still face costly bills

Phone cartoon

We’ve found that current account and credit card providers are still using high-cost telephone numbers, despite a Financial Conduct Authority (FCA) proposal to ban banks call charges.

Thankfully, the most pricey 087 numbers appear to have fallen out of use since we first investigated costly financial calls in December 2013. However, 32% of the current account providers and 36% of the credit card providers that we re-examined in December 2014 were still using high-cost 084 numbers for customer service.

These can cost up to 41p a minute, whereas 03 numbers never cost more to call than a landline number and are often included in call packages.

Switching to basic rate numbers

TSB outlined for us last year why it switched to basic rate 0345 numbers to ensure fairness and transparency with their customers. And the FCA took your feedback on board by consulting on the need to cut the cost of calls to financial firms. As Alfa said previously:

‘Let’s face it, most of the time we contact customer services is because of a problem caused by the company …..and they expect us to pay for the privilege?’

Banks call charges for dedicated complaint lines

Current account providers have cleaned up their act on dedicated complaint lines – none of the 19 we looked at offered an 084 number for this purpose. But six providers – Clydesdale, Lloyds, the Post Office, Santander, Smile and Yorkshire Bank – use them for customer service (although Lloyds do have a landline alternative).

We found 8 out of 22 credit card providers using 084 numbers for customer service, including two – American Express and Tesco – using them for complaints.

Do you feel your bank is doing enough to communicate their cost saving numbers? Are there current account or credit card providers you feel are still charging more than they should?

Comments

The ban on surcharged phone numbers originates from Article 21 of Directive 2011/83/EU on Consumer Rights, which contains exemptions for a number of industry sectors such as passenger transport services and financial services. When the Department of Business, Innovation and Skills enacted the article in the UK under Regulation 41 of the Consumer Contracts (Information, Cancellation and Additional Payments) Regulations 2013, it chose to remove the unreasonable exemption for passenger transport services, but it stupidly chose to preserve the unreasonable exemption for financial services. No industry sector should enjoy an exclusion. The practice of using surcharged telephone numbers for customers to complain should have been outlawed across all industry sectors with no exemptions. BIS failed, leaving the FCA to belatedly pick up the issue. A total shambles and mismanagement by both BIS and the European Commission.

The EU Directive had financial services and passenger transport among a lengthy list of exemptions. For the UK to have overridden the exemption for financial services would likely have been seen to be ‘gold plating’. In the UK this always needed a separate stream of regulation.

Work began on the EU Directive in 2008 and it was published in 2011 with a target date of 13 June 2014 for implementation. The UK adopted the directive, holding a consultation in 2012, publishing draft legislation in August 2013 and the final version in December 2013.

The FCA had long been aware of that implementation timetable but failed to adopt parallel regulation for the financial sector. The FCA is now running a consultation but it’s too little, too late. Whatever the FCA has up their sleeve will be rendered obsolete by the forthcoming requirement, from 1 July 2015, to declare the Service Charge wherever an 084, 087 or 09 number is advertised.

Joan Kingstonm-Lynch says:
31 January 2015

Halifax still charge premium rate on08457 number.

If they continue using 0845 numbers after 1 July 2015 they will have to change all of their marketing materials to declare their Service Charge next to their number.

The replacement matching 0345 numbers should be brought into use at the earliest possible opportunity. Ofcom made these available in 2007.

I complained to Santander, which is still using 0844 numbers for customer service. I don’t like web forms because it is more difficult to keep a track of correspondence The only email address I could find was the CEO one.

I received a prompt reply: “To enable me to register and investigate your concerns, please can you provide me with your full address, including postcode, your date of birth and daytime telephone number?”

My complaint is not over a personal issue. They have my name and email address and unless they want to send my a birthday card, why do they want my dob.

Duncan says:
1 February 2015

Hi Joan for the Halifax use the apps say no to 08 (or Google) and see if there is an alternative offered that is a landline or 03 number
when I dial 0800 numbers using 0800 wizard it will change a number in front of you should a CHEAPER alternative be available
Try this with a few different APPS or websites as it may not be altered on the first that you try to use as NOT in THEIR database but may be included in a Competitor’s alternative database

There are various methods for looking for alternative numbers in order to avoid calling expensive 084 and 087 numbers. Thankfully they are becoming more and more redundant.

The focus has moved on to educating users of 084 and 087 numbers about the forthcoming changes to call pricing with the suggestion they change their number to one in the 03 range.

This immediately benefits all callers rather than the select few who happen to stumble upon some website or app.

Ian – I appreciate what is being done, but the expensive numbers are still with us. I met at least four while switching my home insurance recently.

Until the last costly number has gone, I support anyone trying to inform others of cheaper alternative numbers. You and I know about alternative numbers but many still do not. It seems likely that costly numbers are still being advertised because they are a worthwhile source of revenue.

A distinct “local rate” hasn’t existed since 2004. Even then, it only ever applied to calls made from some landlines, not those made from mobiles.

Calls to 01, 02 and 03 numbers are “inclusive”, else charged at “geographic rate”. Given all that has been said, these should now be in widespread use.

Hi Ian, quite right, I’ve tweaked to use a more generic ‘basic rate’. Thanks for the spot.

Maybe Which could get someone senior from the FCA to write a guest post explaining why they haven’t already made financial institutions stop using these rip off numbers.

I very rarely use a landline phone to contact any firm or organization unless it is a 0800 number . There are other ways if you have a mobile or a computer and internet which you have already paid for in the package you have already..

Chris says:
31 January 2015

What are the ‘other ways’ – surely they are not secret?

We also need action on 03 numbers. The retail cost of calling an 03 number is supposed to be the same as calling an 01 or 02 number, but because wholesale cost of calling 03 numbers is higher than 01 and 02 numbers, this doesn’t always happen. In particular, some VOIP operators and non-UK-based operators, which are not subject to Ofcom regulation, surcharge for 03 numbers above their price for calling 01 and 02 numbers. Ofcom needs to regulate to bring the wholesale cost of 03 numbers down to the same level as 01 and 02 numbers, particularly as many financial institutions are switching to 03 numbers rather than 01 and 02 numbers.

Calls to 01 and 02 numbers have far-end handover. The transit costs are higher for the call originator.

Calls to 03 numbers have near-end handover. The transit costs are higher for the call terminator.

I think this is one of the reasons for the difference in termination fees between calls to landline 01 and 02 numbers and calls to non-geographic 03 numbers.

Working together in September 2013, the fair telecoms campaign and Which? hoped to achieve our shared objectives of extending the principles of what became the Consumer Contract Regulations to cover government (through the Cabinet Office), passenger transport (by removal of the exemption that stood at that time in the draft CCR) and financial services (by the introduction of parallel regulations by the FCA to apply from the CCR implementation date of 13 June 2014).

We focussed on the former two targets and achieved success – the passenger transport exemption was removed from the final version of the CCR, and the Cabinet Office published strong Guidance on 26 December 2013. The greater resources of the Which? team were focussed on the FCA. This led to what was proclaimed by Mr Lloyd as a “big win” when the FCA declared on 14 April 2014 that it was “time to end costly calls for customers” by consulting on the question by the end of 2014.

We continue to disagree, believing that the proper time was 13 June 2014. Is Which? perhaps starting to think that it has not yet won, despite having declared victory?

We have now moved our focus onto the impact of the forthcoming “Clear Call Rates for Everyone”, which will now almost certainly have a much greater effect on all use of 084/087 numbers than a bit of belated catching up by the FCA. It would be interesting to know why Which? has not yet started to join us in pressing for this to be as effective as it could be.

In the past week I have reprimanded several large companies for still advertising 084 numbers for customer service, both on paper and on websites. This should have stopped by last June. A few people are still complaining about costly numbers to phone their GP’s surgery.

The only measure I can see working is to instruct BT or other service provider to suspend calls to these numbers.

To clarify, the complaints I made about costly phone numbers were not in relation to financial services.

The focus now has to be on the forthcoming requirement shortly to be imposed on ALL users of 084, 087 and 09 numbers to either justify their Service Charge and amend all of their marketing materials to declare it, else change their number to stop imposing it. Unlike previous regulation, this also covers sales and enquiry lines.

Yes, the forthcoming obligation to notify callers of the “access charge” will embarrass organisations away from using these surcharged numbers. If it is obvious to the caller that they are paying a per-minute fee to the called party in circumstances where such a fee is inappropriate, then it will create poor customer relations.

What are the new regulations called and where are they published? All I can find is Ofcom documents about the changes, but no wording of the new regulations.

It is telephone companies that must declare their Access Charge.

Service Providers must declare their Service Charge wherever their number is advertised.

These are the two essential components for delivering “Clear Call Rates for Everyone”.

Ian was right to correct the terminology. The portion of the charge to the benefit of the provider of the Service being called is called the “Service Charge”. Each phone company will have to set, and declare a single (pence per minute) rate of “Access Charge” which applies to all calls to 084/087/09 and 118 numbers. (Where the call is at a fixed rate per call, regardless of duration, the Access Charge will be also.)

The Ofcom website describing the changes is ukcalling.info. The amendments to the “Standard Conditions”, which apply to the telephone companies, have been published. The requirement to declare the Service Charge will be imposed by Phonepay Plus for 087/09/118 numbers, in conjunction with the CAP (ASA), which will cover 084 numbers.

We are delighted to see that very many users of 084 numbers are now moving away to 03 or geographic numbers and we hope that this trend will continue and accelerate once the impact of the new regime is recognised. We think it unlikely that many 084 users will be content to declare the Service Charge. There will undoubtedly be some who fail to recognise the change, due to incompetence; they will have to be firmly chased up – and we will play our part in that.

We will look to the ASA (and Phonepay Plus) to take swift and effective action against any who deliberately seek to mislead their callers.

We hope that the growing amount of publicity about the change (which will be deliberately focussed much nearer to the 1 July) will render attempts to mislead ineffective.

Sorry, I meant the “service charge”. I know the difference; I just used the wrong one of the two phrases.

So if an 084 number is not in an advertisement, it won’t be covered by the new rules? As I understand it, the ASA only regulates advertisements.

No, the ASA brief is much wider, for example it includes all information provided on web pages.

If there is seen to be a major gap in the application of the “unbundled tariff”, we will return Ofcom to the points we have made in consultation responses about the need to ensure that Service Charges are invariably declared wherever there may be a need for them to be known.

There may be some cases where, for example, a directory will indicate that all listed 084 numbers have a Service Charge of up to 7 ppm. It is our sincere hope that there will really be very few 084 numbers left, by 1 July, apart from those which are mistakes that will be corrected over the following few months.

Be assured that, although we are taking a positive view at this stage, we will be watching very closely and be ready to act swiftly.

I don’t pretend to understand the technicalities or legal aspects of costly calls. They have been a problem for years. Companies outside the banking sector are still using 0844 numbers, long after they should have stopped. Some are still having to call an 0844 number if they need to make an appointment with their GP. How long will it be before all numbers are compliant?

The process is being dragged out and I have not seen much evidence of action taken against companies and other organisations that have ignored deadlines.

What will the next game be? It was widely reported that EE would be introducing a charge of 50p to jump the queue when calling customer services. Fortunately this appears to relate only to calls from landlines made out of normal working hours, something that an existing customer might do if they have a problem with their mobile.

I am not impressed by the performance of Ofcom.

There should be no surprise that Ofcom have had no involvement in those issues. None of those issues come within a mile of Ofcom’s remit.

Ofcom’s actions have been to make 03 numbers available, enforce the rules surrounding 03 numbers and change the way 084, 087 and 09 call costs are declared.

The forthcoming transparency of non-geographic call costs will ultimately have a far greater effect than all of the other recent regulation and guidance.

Thanks Ian. It looks as if I may have to carry on looking up alternative numbers for some time to come. 🙁

Who are you calling?

Most retailers, traders and passenger transport companies have changed to 033, 034 or 037 numbers.

Most government departments and public services have changed to 0300 or 0345 numbers.

Most banks have changed to 0345 numbers.

Most of the NHS uses 01, 02, 0300, 0344 or 0345 numbers.

Usage of 084 and 087 numbers has massively declined over the last 18 months.

Ofcom’s forthcoming changes will mainly affect sales and enquiry lines and insurance companies as well as mopping up any remaining lines that have failed to heed previous regulation and guidance specific to their sector.

Molly Romanov says:
31 January 2015

When organisations only offer expensive numbers, check on http://www.saynoto0870.com for alternative numbers – freephone, geographical etc. I’ve been doing this for years and must have saved a considerable amount of money.

Duncan says:
31 January 2015

Hello everyone
Try this to save a fortune ALSO
is included in your MOBILE CONTRACT MINUTES allowance ( if applicable)
ANYTIME that you are going to contact a company that DOES NOT SUPPLY an alternative standard rate number (PHONES UTILITIES BANKS and many others)
LOOK AT website under CONTACT US and see if under the selection FROM ABROAD
SWAP the +44(UK international dialling code from overseas) for a 01 and
CHECK IF THIS NOW looks like a standard LANDLINE NUMBER 01……..
BE CAREFUL AS SOME NUMBERS will STILL SHOW THE EXACT SAME NUMBER
THAT IS A REVENUE GENERATING O8 number –
for example +44844……. changes to 01844…………
so you would pay the same EXPENSIVE PRICE for the call
also you may get a head office switchboard
SIMPLY REQUEST your desired department and the operator will transfer your call
I used to do this for SANTANDER (alliance & Leicester) INSTEAD
I called 0116 …,…….. THEIR LEICESTER HEAD OFFICE – cost me nothing as used mobile

Place calls from mobiles to 0845, 0870, 0800 etc numbers via the FREE app WeQ4U. Calls are routed through an 0300 number to the destination’s landline number, so they appear on your free plan minutes – calls are FREE! I tell everyone about this – spread the news!

When I phone Natwest I am informed that there is an 03 number which might be a cheaper option than 0845 numbers.

NatWest offers
0345 7888 444 (England and Wales)
0345 9000 200 (Scotland)

Never call the 0845 numbers again.

Nat west can cost a fortune- when I complained about ringing an 0845 number they came up with a 03 number- which to my mind proves they are trying to make money while they can get away with it- I ran them on an 08 number once and iot was because they had made an error- but all in call cost me £8 to tell them to sort it out

My answer to the problem is to embarrass the company by writing to them and demanding that they ring me to discuss the problem. I tell them that I cannot ring an 084 numbers from the house phone, as they are barred. The cost of them writing a letter is something like £3, so I have won. If they want my business, they have to talk to me, or I tell them, in writing, that I will go elsewhere with my money.
If you say that postage stamps cost too much, think again. Join the Kantar Postal Survey Team and get free stamps – simples!

Robert C says:
1 February 2015

I have checked my current statements and Lloyds bank and Lloyds mastercard both show an 0845 number. At least it is the cheaper one and not a higher 084… (to be fair to BT 0845 only is included in call packages). The bank promotes this as the only number to call. They try to route everything through their call centre and do their best to stop you talking to the branch.

Meanwhile Nationwide offer mainly free 0800 numbers and the same web page provides the geographical numbers as well. For me the main advantage of a free number is not the pence, but the fact that they have an incentive to keep queue times down.

If you’re calling from a mobile phone there’s usually no price difference between calling an 0844 or an 0845 number. From 1 July 2015 the way these call costs are declared is changing.

If they continue using 0845 numbers after 1 July 2015 they will have to change all of their marketing materials to declare their Service Charge next to their number.

The replacement matching 0345 numbers should be brought into use at the earliest possible opportunity. Ofcom made these available in 2007.

Duncan says:
1 February 2015

Robert C
if you have a FLEX PLUS account CALL 01793 541200 (from a say no to 08 APP on mobile ) and you will get that as one off the options in the menu —
May also work with different accounts as on entering the details this could transfer me automatically to a particular card or account number department for me

Duncan says:
1 February 2015

Robert for Lloyds Bank Look at the company website UNDER CONTACT US
the number from overseas is +44 1733 462 255
(for telephone banking) SWAP the +44 for a ‘0’ to make 01733 462 255 It is a PETERBOROUGH area standard landline number
I assume other departments will have a similar number for yourself.
I called this when trying to get a problem sorted for MRS xx – UNKNOWN TO ME as they used a different name on a money site forum ( just like now – I do not know you mate)
BUT were getting nowhere when BY MISTAKE they RECEIVED over £3000- PAID INTO their account. Told the bank but the bank did not want to sort this problem FAST so the person was panicking about this Told to send a CHEQUE but never had a cheque book – Company would supply a cheque but wanted £25,00 for this ??? to fix their mistake
On calling ABOVE NUMBER to find procedure to fix a mistake like this got straight through
at NO COST TO ME as I used a mobile AND I do not bank with them
Eventually it took a MONTH to fix and the woman received over £100.00 compensation to cover their time and expense due to the companies failure to act sooner

John L says:
1 February 2015

First Direct still have 08456 10010 as my current account contact number

Their new number is 0345 6100 100.

Wherever you see an 084 or 087 number advertised, try calling the matching 034 or 037 number.

Duncan says:
1 February 2015

In the article at the top Tesco CREDIT CARD are quoted as using 084 number to contact the company AS AN ALTERNATIVE try 01268 508027 you will still be transferred to the
SCOTTISH CALL CENTRE – for Tesco BUT the dialling code 01268 is for BASILDON Essex
Also try this when calling, PRESS ‘ 0’ on ANSWER and you should be the NEXT call answered by an operator

I.Coltello says:
2 February 2015

If you use the landline number attached to AMEX international contact number you will pay the normal national rate.

This comment was removed at the request of the user

PC World now uses 03 numbers. As these are charged at the same rate as calling an 01 or 02 number and count towards inclusive minutes on landlines and on mobiles, there’s no longer a need to go looking for alternative numbers.

This comment was removed at the request of the user