HSBC u-turn on overdrafts
HSBC has abandoned plans to scrap students’ interest free overdrafts immediately upon graduation, following widespread protest and pressure from the NUS.
HSBC had planned to charge students leaving university last summer 9.9% interest on their overdrafts. Previously, recent graduates had their interest free overdrafts maintained for three years after leaving university, giving them time to find a job and begin to earn a salary.
HSBC had complained that the extended interest free overdrafts had been “abused” in the past, with graduates switching banks frequently and not forming a “long-term relationship” with a specific bank.
The change in policy was met with widespread protest from current students and graduates. A Facebook group entitled ‘Stop the Great HSBC Rip-Off’ attracted thousands of student members and quickly became a platform for NUS-directed action.
Wes Streeting, NUS Vice-President (Education) said that Facebook was instrumental in the victory: “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.”
Under mounting pressure, HSBC announced a reversal of the policy at the end of August. A press release from the bank stated it was “not too big to listen to the needs of [its] customers.”
The decision was welcomed by the NUS, with a spokesman saying recently, “We are pleased that HSBC has recognised that this policy would hit graduates just as they are at their most vulnerable.
“Students often struggle in low paid, insecure jobs upon graduation and the prospect of having the security of the interest-free graduate service pulled from under their feet is clearly unacceptable.”
