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NI banks 'must clarify charges' NI banks 'must clarify charges'
(10 minutes later)
Northern Ireland's banks must clearly outline their "complex" charges to customers, the Competition Commission has said.Northern Ireland's banks must clearly outline their "complex" charges to customers, the Competition Commission has said.
The body has just published measures it is proposing banks will have to take to improve the banking market.The body has just published measures it is proposing banks will have to take to improve the banking market.
Last October, it criticised the banks for confusing their customers over charges applied to current accounts.Last October, it criticised the banks for confusing their customers over charges applied to current accounts.
It is suggesting banks send an annual reminder to customers about their right to close accounts or switch banks.It is suggesting banks send an annual reminder to customers about their right to close accounts or switch banks.
The commission said it had now provisionally decided on a package of measures which it "considers will be practical and effective in increasing competition in the market to the benefit of customers".The commission said it had now provisionally decided on a package of measures which it "considers will be practical and effective in increasing competition in the market to the benefit of customers".
"They are designed to help customers make betterinformed decisions on a timely basis by enabling them to understand the costs associated with their PCAs (current accounts), and also to address the reluctance of many customers to switch banks," it said. "They are designed to help customers make better informed decisions on a timely basis by enabling them to understand the costs associated with their PCAs (current accounts), and also to address the reluctance of many customers to switch banks," it said.
The proposed package of remedies includes:The proposed package of remedies includes:
  • Use easy-to-understand descriptions of current account services
  • Use easy-to-understand descriptions of current account services
  • Provide clear explanations on the levels of charges and interest rates and how and when they are applied-available
  • Provide clear explanations on the levels of charges and interest rates and how and when they are applied-available
  • Provide better information on statements including details on charges and interest rates
  • Provide better information on statements including details on charges and interest rates
    • Eleanor Gill wants to see an end to all unnecessary chargesEleanor Gill wants to see an end to all unnecessary charges
  • Provide to each customer an annual summary of charges and interest payments
  • Provide to each customer an annual summary of charges and interest payments
  • Give customers at least 14 days' notice of charges and debit interest incurred from the date of their monthly statement before these are deducted from their account
  • Give customers at least 14 days' notice of charges and debit interest incurred from the date of their monthly statement before these are deducted from their account
  • Send an annual reminder to customers about their right to close their account or switch it to another bank.
  • Send an annual reminder to customers about their right to close their account or switch it to another bank
  • Introduce improvements to the switching process, including offering a charge-free and interest-free overdraft facility to new customers for at least three months
  • Introduce improvements to the switching process, including offering a charge-free and interest-free overdraft facility to new customers for at least three months
  • Eleanor Gill of the Consumer Council said she wanted to see an end to all unnecessary charges.Eleanor Gill of the Consumer Council said she wanted to see an end to all unnecessary charges.
    The four main banks in Northern Ireland are the Bank of Ireland, Ulster Bank, First Trust and Northern Bank.The four main banks in Northern Ireland are the Bank of Ireland, Ulster Bank, First Trust and Northern Bank.
    ComplaintsComplaints
    The commission will publish its full report in May.The commission will publish its full report in May.
    The inquiry began in May 2005 following a so-called "super-complaint" from the Northern Ireland Consumer Council and the consumer group, Which.The inquiry began in May 2005 following a so-called "super-complaint" from the Northern Ireland Consumer Council and the consumer group, Which.
    Among the complaints being investigated were that the banks levied charges not imposed in Great Britain.Among the complaints being investigated were that the banks levied charges not imposed in Great Britain.
    It was also claimed that the charges appeared too similar across the four banks.It was also claimed that the charges appeared too similar across the four banks.
    In a report on Northern Ireland bank charges last October, the commission found customers paid more for banking but received lower rates of interest on savings.In a report on Northern Ireland bank charges last October, the commission found customers paid more for banking but received lower rates of interest on savings.
    The commission found there was a "lack of clarity on charges and unduly complex charging structures".The commission found there was a "lack of clarity on charges and unduly complex charging structures".
    In response, the banks insisted they had removed or reduced charges and had worked hard to make customer information easy to understand.In response, the banks insisted they had removed or reduced charges and had worked hard to make customer information easy to understand.