Call for jargon-free small print
Banks are being urged to slash the length of their small print after a consumer group found that the terms and conditions attached to some current accounts would take an hour-and-a-half to read.
Which? called for banks and building societies to make sure their terms are easy to read and jargon-free, as it found that just one in 10 people out of more than 1,300 surveyed had read them thoroughly when opening their account.
Its research suggested that a customer would have to spend between 25 minutes and more than an hour and-a-half to plough through the small print of the current accounts surveyed if they were reading at a typical speed of 300 words per minute.
HSBC was found to have the longest terms and conditions, running to nearly 30,000 words, which would take one hour and 37 minutes to wade through.
Building society Nationwide had just over 7,500 words in its terms, making it the most concise current account provider in the survey.
Which? chief executive Peter Vicary-Smith said: “It’s completely unrealistic for banks to expect their customers to plough through 30,000 words of financial jargon and small print.
“Banks should drastically reduce the length of their terms and conditions, so that their customers are not put off from reading them in the first place, and make sure they are clear, jargon-free and easy to understand.”
The research was carried out as part of the consumer group’s Big Change campaign, which is calling for banks to make their services more consumer-focused to help regain trust.
A spokesman for HSBC said: “We regularly review our terms and conditions to ensure they are both clear and transparent and offer our customers the best balance of all the information they need in as simple as possible format to understand.
“Interestingly, Which?’s own researchers found HSBC’s terms and conditions to be one of the easiest to find the information they were looking for, and quicker to navigate than competitors’ shorter documents.”
Which? also asked a panel of 24 people to answer questions on the printed terms and conditions of eight major current account providers.
It found that NatWest had the highest score, with two thirds of questions about its terms answered correctly, while the lowest score was recorded for Lloyds TSB, with only 53% of questions about the bank answered correctly.
The study was conducted last month, and Which? said HSBC and First Direct are making some changes to their terms from December and Halifax and Lloyds have made some alterations since the research was undertaken.
Which? said some examples of long-winded conditions it found include one from NatWest, whose slogan is “helpful banking”, which reads: “We may transfer, assign, or pass our rights or obligations under this agreement or arrange for any other person or organisation (a transferee) to carry out our rights or obligations under this agreement.”
The consumer group translated this to mean: “Your account could be transferred to another bank.”
Here are the length of banks’ and building societies’ terms and conditions, according to Which? and the typical time it takes to read them:
1. HSBC, 29,006, 1 hour 37 minutes
2. First Direct, 25,904, 1 hour 26 minutes
3. Halifax, 20,082, 1 hour 07 minutes
4. Lloyds TSB, 16,293, 54 minutes
5. Barclays, 15,086, 50 minutes
6. Santander, 13,651, 46 minutes
7. Co-operative Bank, 12,593, 42 minutes
8. Smile, 11,295, 38 minutes
9. NatWest/RBS, 11,165, 37 minutes
10. Nationwide, 7,557, 25 minutes
And here are the percentages of questions that were answered correctly about banks’ and building societies’ terms and conditions:
1. NatWest, 67%
2. Barclays, 65%
3. HSBC, 62%
4. Santander, 60%
5. Nationwide, 57%
6. First Direct, 55%
7. Halifax, 55%
8. Lloyds TSB, 53%
Have you ever read the terms and conditions of your bank and if so how long did it take you!?
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