High bank account fees being challenged

21 August 2012

banksThere's few things in life more galling than bank charges. They charge you simply for existing sometimes, which is tough to take, especially given that they're responsible for every single ill in the world right now.

And Which!!!! are going after them, shouting at their turrets and punching the castle walls with their tiny little infant fists. They're saying that there are large variations between banks in the cost of "free" current accounts. They think 'free' banking is a myth.

For example, the cost of going overdrawn without permission for two days a month costs from £120 to £900 a year, which has seen the British Bankers' Association (BBA) calling the report "disingenuous", proffering that customers could get free banking if they wanted to.

Which?!?! aren't having that, saying that even those of you with authorised overdrafts can still run up huge charges and that banks also creaming money from 'free' accounts by whacking fees onto overseas transactions. The consumer group back this up with the opinion of consumers who had been polled, saying that they felt they'd paid a bank charge that was "unfair, hidden or disproportionate".

The Competition Commission, the Office of Fair Trading (OFT), the Financial Services Authority (FSA), and the Independent Commission on Banking have all echoed sentiments that the term "free" is misleading.

John Howard, former FSA chair, said: "Customers don't know what the real cost of providing that basic banking service is. It makes it more difficult for new banks to enter the market place because it is a very difficult thing for new banks to set up and match this free-banking-if-in-credit offer."

"And it does encourage banks to cross-sell other products, in some cases far too eagerly, and we have had too many instances of mis-selling."

Which!!! chief executive Peter Vicary-Smith says: "It's a disgrace that the very people who bailed out the banks are being asked to pay more for the most basic accounts, while the industry continues to be rocked by scandals like PPI mis-selling, Libor rate-rigging and IT failures."

TOPICS:   Banking   Investments   Complaints


  • Dick
    It costs me nothing for my bank account, since I never go overdrawn, never miss a credit card payment, and never get any fees. Yes, they might not pay the BoE interest rate, but if I don't put my money in the bank and leave it under my bed, then it doesn't grow at the BoE either. What the cunts at Which$$$ want to do is make everyone pay for their bank account. Why should someone making a couple of direct debits a month have to pay the same as someone that uses 50 cheques, 10x withdrawals at the cashpoint, 5x withdrawals in branch? Or are they going to charge per usage? That will really hit the poor, since it is the poor that tend to take out £10 at a time.
  • PJH
    "For example, the cost of going overdrawn without permission for two days a month costs from £120 to £900 a year..." And the cost of knowing WTF's in your bank and therefore not going overdrawn at all for any days of the month costs you how much?
  • Chewbacca
    WOW, BW mderating comments. Pity they don't moderate the ones about foxes etc. THOSE are the ones that piss people off about this site.
  • Sicknote
    I pay for my bank account and that provides me the freedom to contact my personal relationship manager day or night any day of the week.
  • lesdennisfanclub
    I love people who talk about how squeeky clean their accounts are and how they never go overdrawn....My account used to be like that WHEN I WAS A SINGLE LONER...

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