Alliance Turning Towards The Financial Dark Side
Adsense ContentArticle Title: 7 Strategies to Make Room For Money Author Name: Joanne Victoria Contact E-mail Address: mailto:joanne@joannevictoria ..... ...... on credit cards, reductions in children's savings accounts, whilst The Guardian (http://money.guardian.co.uk/saving/banks/story/0,12410,1509094,00.html) has revealed some suspect changes that have been implemented to their systems to increase the number of customers who breach their overdraft agreements, triggering penalty charges.
A&L has said that there is no hidden agenda, and that it still leads the way compared with its banking rivals.
A&L however, are not the only financial group to be feeling the pinch. Barclays, HBOS and Royal Bank of Scotland have all warned about credit arrears. An announcement concerning job losses at Scottish Widows, came alongside admissions from their owners LLOYDS TSB that there was, 'An increase in the number of customers experiencing repayment difficulties' with their credit card debts and unsecured personal loans. According to Lloyds' Chief Executive, Eric Daniels, we are currently experiencing, "a slowing consumer environment".
Recent announcements by the Treasury delivered the worst monthly public borrowing figures since records began in 1993, re-igniting fears over a possible rise in taxes.
Consumers are reducing the amount they borrow on credit cards and analysts predict mortgage lending in the UK will plummet by 10 per cent over the next three years, as the out of control growth in house prices finally stalls.
Independent market analyst Datamonitor claims, lenders who have been enjoying a boom in recent years, will struggle to maintain the momentum and be forced to work harder to secure market share.
Investor Connections, a group of independent financial advisers, has called for an accurate assessment of the UK's current economic position, after statistics showed the three main asset classes, shares, bonds and property are all experiencing downward trends.
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This downturn should spell good news for borrowers and homeowners, as the mortgage and credit industries fight for customers and sharpen up on their competitiveness; however the evidence of Lloyds TSB's actions seems to belie this. With HBOS forced to criticise the other credit card companies for failing to provide customers with adequate product information, despite repeated requests to do so from consumer lobby groups and watchdogs on the Treasury Select Committee, it looks like the majority of finance companies are currently out to protect themselves and their share-holders, with little regard for their customers.
At a time when UK consumers are proportionately saving less than half of what they were 25 years ago, you might be forgiven for thinking that competition in the banking world would be becoming increasingly cut-throat in order to gain customers' business, but it seems that the big institutions are instead looking to go down the route of cost reduction to protect their profits. There are savings are out there to be made, but they are savings in costs to be made by the finance companies, at the expense of the consumer, rather than beneficial savings for the customer.
About the Author: Richard works in Edinburgh for a media company, occasionally writing for the personal finance blog Cashzilla ( http://cashzilla.blogspot.com/)
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