KBC Change Term Deposit T&C's

KBC have change the T&C's on term deposits by inserting the below clause:

with effect from 20th January 2014, unless the Bank receives instruction(s) from you on or before the maturity date, the full balance in the account will be reinvested in a similar fixed term product at the prevailing interest rate for that product on that date. If on the maturity date there is no similar fixed term product available, the full balance in the account will be reinvested in our Standard Demand Deposit account earning the then prevailing Standard Demand Deposit Account interest rate.

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In other words, if you do not give an instruction, by maturity date, KBC will lock your deposit for a fresh period, without an instruction from the customer.

For example, if you have a 3 year term deposit with KBC and do not give an instruction by maturity date, you could find your deposit locked for another 3 years.

In my opinion, this kind of thing should not be allowed. A deposit should not be locked without an explicit consumer instruction.

Some other banks, do similar things with matured term deposits.

All the more reason, to put reminders in your calendar, for the weeks leading up to maturity date, to ensure that you remember to give your bank an instruction well in advance of maturity date.

It is sneaky and unfair, and to my mind should not be allowed.

What I have done in the past is on the day I open an account or a few days later when the paperwork comes in the post, is there and then send an email stating that I want the funds to be transferred to my current account/posted to me by cheque/placed in a demand account etc.

It does not guarantee it will actually be done as you instruct, but you have the email as a record that you have given an instruction - and normally that has done the trick.

Obviously it is better to instruct them a few days before maturity - but things can easily get in the way when the time comes around or you can simply forget etc

In fairness to KBC, whenever any of my fixed term accounts has matured in the past they have written to me beforehand to ask me what I would like to do. This clause is stating what they will do if they do not receive any instruction. Their T&C's also confirm that they will write to you.

Clause 10.3 confirms they will send a letter.

10.3 A letter will be sent, giving 10 Business Days notice, in relation to maturity of fixed deposits. This does not apply where the maturity date of the Deposit Account is less than 30 Days.​

HI Ciarán

I think that this is reasonable for short term deposits e.g. 30 days or, possibly, 90 days. But for three years it's unreasonable.

The default should be to their best notice account.


Have they written to customers to highlight this change?



Brendan

The T&C's currently on their website state that all fixed term accounts will become 'Standard Demand Deposit Accounts' if no instruction is received. I presume the change outlined will come into effect in new T&C's in January.

KBC have not yet written to customers advising of the change. Maybe they are not going to write to customers. They certainly should.

I think the default instruction should be the highest rated instant access product offered by the financial institution.

The change in T&C's, effective 20 January 2014, has been posted on the KBC website in the small print [broken link removed].

KBC advertised this change in the Irish Independent on 20/12/2013.

The advertisement shows the old clause which states that, if no instruction is given at maturity the account will become a 'Standard Demand Deposit Account'. It then shows the new clause that CiaranT has provided.

The change applies to Standard Fixed Rate Deposit Accounts, Fixed Rate Deposit Accounts (with Withdrawal Facility), Top-Up Deposit Accounts & Interest Upfront Savings Accounts.

If you would prefer not to accept this change you can contact KBC on 1800 93 92 44 within 30 days (of 20/12/2013) and you can remain on the existing T&C's. If they do not hear from you within 30 days you will be deemed to have accepted the change.

I have a photo of the advertisement attached below.

[broken link removed]

If you want to post the image, you can upload an image to a service such as Postimage.org, then you can use the image tags here.

CiaranT said:

If you want to post the image, you can upload an image to a service such as Postimage.org, then you can use the image tags here.

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Cheers Ciaran. Image now added.

Thanks for posting that DMcL1971.