Bank charges could mean many consumers switch bank

A recent survey has been carried out by the consumer campaign group Which?, and the results reveal that there could be a rush of consumers flocking to switch banks in the event that standard monthly bank charges are brought in, effectively bringing free banking in the UK to an end.


A high court case scheduled for early next year will determine what sort of charges banks can impose on the accounts of those that exceed their overdraft limit, and for bounced cheques or returned direct debits. However, if things don’t go the way that bank want it is likely that many may introduce monthly account charges to recoup their financial losses.

According to the results of the survey around 80% of the 1022 people polled would look at switching to another bank if these monthly charges are introduced. Over 70% of those that were polled said that they thought it unfair that banks should bring in these charges, and many want the government to put regulations into place that will make sure that banks are not going to overcharge customers to swell their own profits.

According to a spokesman from Which?:  “Consumers don’t want to be charged for their current account and will vote with their feet if their bank introduces a monthly or annual fee. Our research shows that customers would support Government intervention to make sure banks don’t overcharge.”

An official from the British Banker’s Association also commented, stating: “UK banks offer the most cost effective and comprehensive package of current account services around and are keen to continue to do so. We have always said there is a place for the current model of free banking and part of the reason for seeking the clarity of a court decision on bank fees is to defend this.”

Tom Smith
20th November 2007

Tags: rush, government intervention, bank accounts, banks, profits, consumers, switch bank a, november 2007 bank