Business Irish

Tuesday 16 July 2019

KBC challenges rivals to make it easier for current account customers to qualify for fee-free banking

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Charlie Weston

Charlie Weston

CHALLENGER bank KBC is putting it up to its rivals by making it easier to qualify for fee-free banking on its current account.

The move comes as both Ulster Bank and Permanent TSB have made it much harder to avoid paying fees for day-to-day banking.

Permanent TSB is set to increase the fixed monthly fee for its Explore current account by 50pc this summer. This will make it more difficult for customers to qualify for free banking.

From August the fixed monthly fee for its Explore current account will rise by 50pc, from €4 to €6.

This means that over a year the new cost will be €72 for operating the Permanent TSB Explore account, up from €48.

The bank came in for strong criticism when decided that from March people on legacy accounts now have to pay the €18 quarterly fee unless they keep a balance of €2,500 in the account every day.

Earlier this year Ulster Bank imposed transaction charges for operating its current accounts, a move that is likely to see thousands of customers hit with higher costs.

Up to April Ulster Bank charged its current account customers a monthly maintenance fee of €4, but it had no transaction charges for the likes of ATM withdrawals or for paying with a debit card.

It has reduced the monthly maintenance fee to €2, but will charge customers transactions fees for using the current account for their day-to-day banking.

AIB and Bank of Ireland require customers to keep between €2,500 and €3,000 in credit in their accounts to avoid fees.

Bucking the trend, KBC is to make it easier for free banking from the end of this month on its Extra Current Account.

It is cutting the amount customers need to lodge to their account from €2,500 a month, to €2,000.

You do not need to keep the account €2,000 or more in credit, just lodge that amount each month.

Six out of 10 KBC current account customers currently avail of fee-free daily banking, according to director of products at KBC Fergal O'Riagain.

Those who qualify for free banking will avoid transactions fees for direct debits, card transactions and ATM withdrawals. There will be no maintenance fees, and no overdraft set-up fees.

There will no charges for contactless payments.

Using the account also qualifies customers to a discount on their mortgage rate, and a bonus for the regular saver account.

Daragh Cassidy of price comparison site Bonkers.ie said:  “It’s been a pretty rough few months for current account customers in Ireland.

“Back in April Ulster Bank introduced new fees for a host of day-to-day transactions and in May Permanent TSB revealed that it was increasing the monthly fee on its flagship Explore Account by 50pc from August 1.”

He welcomed the KBC Bank move.

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