Saturday 16 December 2017

End of free banking as Ulster to charge for account

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Charlie Weston Personal Finance Editor

Customers are facing a battle to get free banking -- as the last bank pulled the plug on its no-fee accounts.

The move by Ulster Bank means that all six banks offering current accounts will now impose fees unless customers meet stringent conditions.

The change comes just days ahead of AIB's new rules which will result in up to one million of its 1.5 million customers being charged for day-to-day banking.

Ulster Bank is to shortly announce the end of automatic entitlement to fee-free banking, with a new charging structure expected by the end of the summer, the Irish Independent has learnt.

Currently, it is the only bank that does not require customers to meet tough conditions in order to qualify for free banking on its standard current account.

However, the bank does charge quarterly fees of between €30 and €42 on its U-First and U-First Gold accounts.

The exact details of the charges have yet to be finalised, but it is expected customers will have to keep a credit balance in their account in order to avoid quarterly fees and ATM charges.

From Monday, AIB customers will need a minimum daily credit balance of €2,500 in their account for the full quarter to avoid quarterly maintenance fees and charges of up to 30c for each transaction.

Shutting

The bank has also written to thousands of customers who have Cashsave Accounts telling them that it is shutting down these accounts.

Half of the 400,000 people with a Cashsave account use it for day-to-day banking as the account came with a Laser card. These people have direct debits and standing orders as part of the account. Others used it as a savings account.

The change means up to 200,000 people are facing banking fees for the first time. Those who use this account for day-to-day banking will be transferred to the AIB current account.

Banking sources said the AIB changes are likely to result in the average householder shelling out €90 in fees.

The changes follow similar moves at Bank of Ireland, EBS and National Irish Bank, all making it harder for existing customers to avoid fees.

Bank of Ireland was heavily criticised last year when it introduced fees of 28c per transaction for those who do not keep at least €3,000 in their account every quarter.

The bank also asks its customers to make nine payments every quarter through their current account to avoid fees.

Permanent TSB imposes charges of €12 a quarter for new customers -- unless they lodge at least €3,000 and make a minimum of 18 card purchases and at least one financial transaction through telephone and online banking. They must also keep the account within agreed limits.

EBS has also increased its fees for customers who access their savings using an ATM card.

A study released by the Central Bank before Christmas found that most people pay between €86 and €120 a year for operating their current account.

Irish Independent

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