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Thursday 26 April 2018

Ulster hits customers with €50 in new overdraft fees

Peter Flanagan

Peter Flanagan

ULSTER Bank customers are to be charged for overdraft facilities, as lenders continue to re-introduce fees for basic services.

It comes barely two weeks after the lender ended free banking for most of its customers.

The bank will start charging current account holders €25 to set up an overdraft facility and a €25 annual fee to maintain the facility from September 16.

The maintenance charge will hit all overdrafts, so even those that have a facility in place will not be able to escape the fees.

The overdraft set-up fee will also apply to any increases in existing overdrafts, Ulster Bank said.

The fees will not apply to special accounts, such as graduate and student accounts.

So-called "packaged accounts", where customers pay a membership fee for "added banking and lifestyle benefits" will also be exempt from the charges.

The move comes 16 days after the bank began charging its clients €4 a month for maintaining their current accounts.

Ulster had promised not to impose fees for a year after the bank was hit by a computer breakdown last summer that prevented thousands of customers from accessing their accounts for weeks.

Ulster Bank's charges are marginally cheaper than similar facilities at the pillar banks.

AIB charges a fee of €25.39 per annum or per overdraft sanction, whichever is more frequent, on personal accounts.

As with Ulster Bank, there is no charge on student and graduate accounts.

Bank of Ireland meanwhile charges an annual fee of €30 for an overdraft facility, while the interest rate charged varies depending on certain conditions on the account.

It continues the trend of banks bringing back charges that were dispensed with long before the crash. Ulster Bank is the third major lender to bring in charges in the last 18 months, dramatically reducing the options for customers seeking to minimise their charges.

In May last year AIB effectively scrapped free banking for around 60pc of its customers, imposing charges for accounts that don't maintain a cash balance of at least €2,500 over a three-month period.

Previously, charges were waived for any account holder who made one payment per quarter through internet banking, and who used a debit card on at least one occasion.

Now, AIB charges a quarterly maintenance fee of €4.50, with a further charge of 20c for every electronic transaction and 30c for each staff-assisted or paper transaction.

That followed Bank of Ireland's lead, who introduced a similar scheme in 2010.

Irish Independent

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