£10 for a current account

[PsychoCannon]

So I read in the papers (http://www.dailymail.co.uk/pages/live/articles/news/news.html?in_article_id=437233&in_page_id=1770&in_page_id=1770&ct=5&expand=true#StartComments) this morning that several banks (Citibank) have already started charging customers for a Current account and the others are setting to follow suit.

The common lines seem to be:

'It's not free to run a branch or an ATM (javascript:self.name='main';PopUp('you_popup','/pages/jargon/index.html?in_jargon_term=ATM','350','150')), so what it means is that when you apply charges to delinquent accounts they bear the large proportion of that cost,' Graham Beale said in newspaper reports. 'In an ideal world those costs would be shared.'

So it's not "fair" to illegally charge extortionate fees only to the people that go overdrawn and the people who keep themselves in the black should share the cost?

Industry leaders claim compulsory monthly fees on current accounts, which are common in North America and Europe, are the 'fairest' way to charge.

Misleading - In America Current acount charges average around 90p not £10 and you get a hell of a lot more service for your money.

One bank industry insider told the Daily Mail: "The truth is that fees will come. Banks are providing a service and it is right that customers pay for it."

Sorry bollox.
Current accounts are more like a Pyramid Scheme than a service.
We give the banks our money and they use it to invest, speculate and make profits for themselves.
They return a miserly amount of the profit back to us in interest.

The Services they DO provide (Loans/Mortagages) are already charged for.

Personally if all the banks end up doing this I'll simply take my money and invest it in some home security and start keeping my money at home and see how the banks get on with no customers to fill their pockets for them.

[SoulKiss]

Given that he will likely ask for advice on said security here on the forum.

MODS - wheres the member location map again !!!!

LOL

[DarrenSV650S]

I think they've got a damn cheek!!:smt013 They make millions off us every day and they want us to pay them to do it:confused:

[northwind]

2 margin banks there... Chargable accounts have been around for ages, with stuff like RBoS Royalties and the like, but I don;t see any trend away from free banking. What we might end up with is no-frills cheap banking, and charges for overdraft limits, or no interest on credit balances... And better accounts all being charged for. But at the moment, all of the chargable accounts out there have balancing benefits as far as I'm aware, like the Royalties one and the new HBOS Ultimate one with the travel insurance, breakdown cover, and massive interest (6% I think it is, on a current account)

Another strong possibility is that visa debit cards, overdrafts etc get withdrawn from the lower-end products. Most banks already do this, and have a poor man's current account and a better version. You might well see that credit score requirements for full visa debit or for other services go way up.

In fact, the facilities from free current accs- particularily overdrafts and interest- have improved loads in recent years... Think about a current account 5 years ago, you got a switch card and cheque book if you were lucky, a small overdraft unless you were loaded, and interest below inflation.

It's also relatively easy to shift a current account- again, 5 years ago it was a fiasco with direct debits etc. So if your bank does start to charge you, you know what to do.

[Cronos]

This is something the banks would love to introduce as it would provide them with a large steady revenue stream. It's been talked about for decades, but no bank has had the bottle to introduce it unilaterally as they would risk seeing a sizeable exodus of customers.

That said, they are trying to make inroads. Charging fees for value added accounts (Premier, Royalties, etc.) is one way to start getting that steady revenue stream and get customers used to the idea of paying flat charges. As northwind said, it's the marginals that are taking a risk by setting fees for vanilla banking services. Even then, First Direct are being very cautious to introduce fees only for those accounts with lower incomes, which from a commercial perspective makes sense.

This isn't going to happen tomorrow and competition in financial services is such that there will always be institutions looking to gain a advantage, so there should always be some sort of free product.

Let's also not forget that the advent of the euro will open up all sorts of cross-border personal banking opportunities and competition. ;)

[AlanSv]

I'm happy with my RBOS Royalties Gold account. Saves me money on insurance and all sorts of things, for the small yearly fee.

[Bluewolf]

.

[kwak zzr]

As above! this one makes my blood boil!!

[Ed]

Fact is that banks have to make money somewhere, and I wouldn't mind a reasonable amount to maintain my account. It's mostly overdrawn - reality of being self-employed is no nice salary cheque at the end of each month, just very lumpy cashflow:( One of my staff saw my bank statement, I caught her, she couldn't believe what she was seeing. But then I clear the lot as soon as clients pay up.

[K]

Some of the existing chargable current accounts have an upper balance - usually £1k that if you are above that at the beginning of the month you don't have to pay your £10 (or whatever) for that month. Great for those with a wage packet coming in that tops it - the situation I used to be in by a few quid each month a few years ago.

Now however, with no regular income so to speak I get hit each month - but there are enough compensations, like travel insurance, that seem to make it worthwhile.
Financially they may not strictly balance out, but in my poor little confused brain they do as some things are just easier - with one phone call to the bank rather than shopping around for something.

I've been paying the charge for years and so think nothing of it really - but if it was to become an issue then there are always going to be really basic accounts out there. And as already said, there is enough competition in the Financial Marketplace, due to the ease of switching accounts, that there will always be something out there that is suitable for what you need service wise at a price you are willing to pay.

[PsychoCannon]

Hmm I could understand if they introduce "premium" current accounts that they charge for in return for perks that would count as service on top of the usual but as I see it for a standard current account they use my money to make money and I provide a service to THEM.

If they want to charge me for my standard current account I'll be sending THEM a bill for using my money, mainly bank rates + 6% profits or some such.

Problem with Premium accounts is they'll then start making normal accounts unviable by restricting services and adding fee's to do things with them forcing people to switch.

With the case of charging acounts only below a certain limit "less than a grand balance" that only hits the hard off like those on the Doll or in financial difficulty.