Finance News

Which? group joins calls against current account charges

Consumer advice group Which? have joined the ranks of those criticising the banking industry’s current move towards charging for current accounts.

Whilst the banks and the Prudential Regulatory Authority claim that ending free banking will stop banks tricking people into paying for products they don’t need and charging extortionate amounts for overdraft fees, Peter Vicary-Smith, executive director of Which? believes that free banking is already a myth and that banks will simply see this as a chance to get an extra £15 a month from every customer.

People already pay for their bank accounts by not receiving the full interest on money they have held in the current accounts, paying interest on overdrafts, paying for services they use overseas and, most notably, paying through their taxes which now provide financial insurance to all British banks.

Mr Vicary-Smith released a damning attack on the banks’ arguments: “When some people are paying up to £900 a year in bank charges it completely shatters the myth that banking is free. The suggestion that banks should increase charges to avoid more scandals defies logic and is a slap in the face for consumers who are being hit hard by one of the worst financial crises in recent times. 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.”

It’s a stance that plenty of people will agree with. Given the number of scandals and problems that have emerged recently, along with the history of obscene levels of bonuses and pay being given out by the industry, many will refuse to believe that just paying up to £15 a month for their current accounts will be enough to satiate the greed of banks.