Eric complained that the bank’s earlier advice that a "lower rate" of interest would be applied was misleading and that its terms and conditions about the interest rate were unfair and unreasonable, as well as amounting to a penalty, and were therefore unenforceable.
In investing its funds on term deposit, the trust had agreed to invest the funds for a fixed period on the bank's terms and conditions, which made clear, in reasonably plain language, that early withdrawals would be at the bank's discretion, and that it would apply a lower rate of interest to the amount withdrawn early.
We considered the bank's terms and conditions fair. They referred to guidance on the bank's website about the reduced interest calculation. We considered 0.05 per cent to be not an unenforceable penalty. We were satisfied the bank had complied with its terms and conditions, when it paid the funds to the trust.
We did not uphold Eric’s complaint.Print this page