HSBC Vs The NUS 03/09/2007

HSBC’s recent announcement sent students in to whirl after announcing the appliance of interest charges on graduate’s overdrafts taking effect from August. Originally HSBC offered fee free overdrafts when students signed up to their accounts. Once graduated students were entitled to a £1500 overdraft in their 1st year after university, £1000 in their second year and £500 in their 3rd year to help students gradually pay off their university debt at an affordable rate.

HSBC last month without warning informed their customers that a 9.9% interest charge would be applied on graduate accounts after the 8th of August. Alternatively customers could pay £9.99 a month to keep their overdraft privilege. This could mean that those students with a £1500 overdraft could be charged £148.50 interest per year.

In protest for those students banking with HSBC the NUS launched a campaign on the increasingly popular facebook website named “Stop the Great HSBC Rip-Off!!!”. This campaign generated backing from over 5500 students. In addition to this the National Students Union planned a protest for next Tuesday 4th September at HSBC’S Canary Wharf Head Quarters in London.
Wes Streeting (the creator of the facebook campaign) from the NUS : “It’s outrageous that HSBC has imposed such changes after very little notice and consultation with its customers. We are encouraging current and new students to look carefully at their banking options”. Spokesmen from HSBC believed that these actions were an attempt to reduce student’s debts: “The idea behind the interest rate was to get them to bring their debt right down now rather then leaving it to their early or even late 20’s”.

HSBC quotations featured on the face book campaign emphasised how HSBC believed their actions were to convey the message that there is a cost to borrowing. This unsurprisingly caused much upheaval for those students who signed up to bank with HSBC in the belief that they would have an interest free overdraft after graduation. On Friday 31st August however, it was announced that after discussions and negotiations with the NUS, HSBC have decided to freeze their actions on applying interest on 2007 graduate overdrafts up to £1500, with future policy subject to review. HSBC have also vowed to refund any customers who may have paid interest charges over the August period. A HSBC Spokesman said that the bank was not too big too listen to its customers.

Following this recent turn in HSBC’s proposal the protest scheduled at their headquarters by the NUS on the 4th of September has been suspended, and all those who signed to the face book revolt against HSBC will receive further communication through face book on what decisions have been made.

If HSBC had stuck to their plans they would have been heavily affected by the reduction of students joining them as university approached this September. Face books campaign received such large amounts of student backing which will have evidently have influenced HSBC’s change of plans. Especially as the voice’s of the NUS were running the campaign. If they want students as their customers they have to work to their needs.