Bank customers warned to avoid fee-paying accounts

March 20, 2008 by admin  
Filed under News, News-Banking

Bank customers paying fees for packaged accounts are getting very little for their money compared with customers in free accounts, according to new research.

Findings from MoneyExpert revealed that the average credit interest rate on packaged accounts is 2.1 per cent per month, only 0.2 per cent more than the average rate available through free banking.

The average monthly fee of a packaged account is £11.61, with some accounts charging as much as £25 a month.

Sean Gardner, chief executive of MoneyExpert.com, said: “The basics of a typical fee-paying current account are frankly terrible value for money.”

“You don’t have to be a mathematician to see how an average interest rate of just 2.1 per cent compares to free banking if you have to pay a typical fee of £11 for the privilege,” he added.

The figures show that over half of all packaged accounts pay less than 2.5 per cent AER on positive balances.

Meanwhile, financial experts Fool.co.uk said that there are “lots of good offers” on the bank account market due to the effects of the credit crunch.

Tags: executive, rate, mathematician, financial experts fool.co.uk, research

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