ASA reprimands UK bank for misleading customers
October 5, 2007
One of the UK’s leading banks, the HSBC has recently launched a new advertising campaign that claims customers can withdraw cash abroad using their card without incurring any charges from the bank, no matter which currency they are withdrawing.
According to the recent advertise run by HSBC: “Whoever’s on the banknotes, with Bank Account Plus you can withdraw them worldwide and we won’t charge you.”
However, the advertising regulator in the UK, the Advertising Standards Agency, has decided that this is not the case, and has told the bank that it must stop running the advertisement until changes have been made. The Advertising Standards Agency claims that the advertise is misleading to customers because there is in fact a foreign exchange transaction fee applied to cash withdrawals, which is commonplace for cash withdrawals made abroad, but this fee is not mentioned on screen or verbally when the advertisement is run.
The foreign transaction fee is 2.75%, and HSBC has tried to defend itself by claiming that this fee is always charged on cash withdrawals abroad. However, the ASA stated that the fee is classed as a type of transaction fee, and therefore the bank cannot claim to enable customers to withdraw cash for free. The investigation was launched after a rival bank complained about the advertisement, stating that it was misleading customers over its claims of being able to withdraw cash abroad at no charge.
According to a spokesperson for the Advertising Standard Agency: “Because there was no mention of the exchange rate fee in the on-screen text, and because we understood that cash machine withdrawals from overseas ATMs always incurred this charge, we concluded that the ad was misleading.”
Alan Wright
5th September 2007
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