Why do banks charge a fee on "insufficient funds" when they know there is not enough?

Answer 1

Because they are a load of bankers

Answer 2

there is no actual law that says they can or cannot charge for this. so if a lot of charges occur on your account u can actually take them 2 court, they will usually refund part or all of ur money 2 avoid going 2 court because if enough ppl take action like this eventually a law will be imposed about how much banks are allowed 2 charge and they'll lose out on a lot of the money they're making from these charges already which is what they dont want.

Answer 3

There used to be bank charges for everything but they changed it. Now you only get charged if you go beyond your limit i.e. overdrawn or beyond your overdraft if you have one.

Banks love the words "Insufficient Funds" because that's how they make their extra money

Answer 4

Contrary to what people think, banks do *not* want you to get an overdraft.

Banks charge the fee to deter you.

Banks make their money by borrowing yours; therefore, they have an incentive for you to keep a positive balance. That's also why they want you to keep depositing more money. You put the money in, and they invest it to make it grow. When you want it back, they give it to you. You've gotten your safekeeping for your money, and they've gotten use of some investment capital. Everybody wins.

Answer 5

Three resaons:

1)Banks want to make money.
2)Because they can.
3)They cause people to have bad credit, which equals higher interest rates to charge in the long run.

Answer 6

Because they know that if you can't pay the charge they can put another one on....and eventually you will owe them money every month where you can't keep up with the charges....just a terrible way for them to make money out of skint people !!!

Answer 7

Because making money out of moving/storing/advise moeny is the second oldest buisness.
Just like the oldest buisness, its run by sleazzz, and exploits people.

Answer 8

They do it to deter account holders from writing bad checks again. It's probably more convenient from them to charge a fee to the customer than it is to file legal charges for fraud.

Answer 9

Totally unfair. Penalising the poor.

Answer 10

what is unfair the fee that they charge you will more than likely be more than the cheque that you wrote out therefore putting you further in debt enabling them to charge more interest on the unauthorised overdraft

Answer 11

bcoz it is their policy they have to charge if their depositor couldn't maintain the agreed maintaining balance it is their business to grow if some one goes below the maintaining balance it would be a burden for them to keep records reconciling for something unproductive in their operation banks employes people whom they have to pay for their work they have recurring expenses on their daily operations