Bank’s U-turn on student charges
A student campaign using the social networking website Facebook has forced an international bank into a U-turn over charges. HSBC is to abandon plans to scrap interest-free overdrafts for students leaving university this summer.
Thousands of students on Facebook had threatened to boycott the bank. The National Union of Students said this made all the difference to the protest.
The HSBC bank said it was not too big to listen to its customers.
Many students said they had joined the bank in the belief that they could take advantage of such a free overdraft to tide them over between leaving university and starting work, the NUS said.
Facebook pressure
But HSBC had planned to charge students leaving university this summer 9.9% APR on their overdrafts.
The bank said in a statement: “Following the feedback from our graduate account holders, both directly and via the NUS, we have taken the decision to freeze interest charging on 2007 graduates overdrafts up to £1,500.”
It added that it would be refunding any interest charged in August and was working with the NUS.
NUS president Gemma Tumelty said she was pleased that HSBC had listened to the concerns of students and graduates.
‘Customer loyalty’
She added: “Students and graduates are valuable future customers for banks, and it is therefore crucial that those banks recognise that their support and fair treatment is likely to be rewarded with customer loyalty in the long term.”
NUS vice president Wes Streeting said: “There can be no doubt that using Facebook made the world of difference to our campaign.
“By setting up a group on a site that is incredibly popular with students, it enabled us to contact our members during the summer vacation far more easily than would otherwise have been possible.
“It also meant that we could involve our former members - the graduates who were going to be most affected by this policy.”
HSBC said the charges would not now be applied to this year’s crop of graduate account holders, and that it was meeting with the NUS to discuss the shape of future accounts.
The protest came as banks such as HSBC are seeking to recruit new student customers at the beginning of the academic year.