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| Version 2 | Version 3 |
|---|---|
| Monthly bank charges 'not wanted' | Monthly bank charges 'not wanted' |
| (about 5 hours later) | |
| Bank customers do not want monthly account fees even if it spells the end of penalty charges, a survey suggests. | Bank customers do not want monthly account fees even if it spells the end of penalty charges, a survey suggests. |
| The High Court is due to decide in a test case whether the level of penalty charges made by banks is lawful. | The High Court is due to decide in a test case whether the level of penalty charges made by banks is lawful. |
| If the banks lose, some fear they may try to recoup money with monthly fees or by charging for each transaction. | If the banks lose, some fear they may try to recoup money with monthly fees or by charging for each transaction. |
| A YouGov survey of 2,116 people for website Moneysupermarket.com suggested just 8% wanted a regular fee with 1% wanting a charge for each transaction. | |
| At the moment, people can be charged as much as £35 for going overdrawn without authorisation or for having a direct debit refused. | At the moment, people can be charged as much as £35 for going overdrawn without authorisation or for having a direct debit refused. |
| The Office of Fair Trading (OFT) is investigating the current penalty charges system. | The Office of Fair Trading (OFT) is investigating the current penalty charges system. |
| Pay-per-transaction | Pay-per-transaction |
| Some experts suggest that the money from these charges essentially subsidises the accounts of people who did not incur them. | Some experts suggest that the money from these charges essentially subsidises the accounts of people who did not incur them. |
| We have already seen some providers abandon the concept of free banking by steadily introducing a bevy of charges on their less profitable customers Kevin Mountfordmoneysupermarket.com | We have already seen some providers abandon the concept of free banking by steadily introducing a bevy of charges on their less profitable customers Kevin Mountfordmoneysupermarket.com |
| Kevin Mountford, head of current accounts at moneysupermarket.com, said free banking was possible "largely because of the number of people who are hit with fees and charges". | Kevin Mountford, head of current accounts at moneysupermarket.com, said free banking was possible "largely because of the number of people who are hit with fees and charges". |
| If this was outlawed, a pay-per-transaction system - as used in many other countries - could be introduced in the UK. | If this was outlawed, a pay-per-transaction system - as used in many other countries - could be introduced in the UK. |
| "We could well see the system prevalent in Western Europe, North America and Australia, where there are a certain number of free transactions and then you pay for any additional ones," Mr Mountford said. | "We could well see the system prevalent in Western Europe, North America and Australia, where there are a certain number of free transactions and then you pay for any additional ones," Mr Mountford said. |
| "We have already seen some providers abandon the concept of free banking by steadily introducing a bevy of charges on their less profitable customers." | "We have already seen some providers abandon the concept of free banking by steadily introducing a bevy of charges on their less profitable customers." |
| The introduction of such transaction charges could lead to a change in the spending habits of people used to making cash withdrawals or multiple card transactions, he added. | The introduction of such transaction charges could lead to a change in the spending habits of people used to making cash withdrawals or multiple card transactions, he added. |
| Court action | Court action |
| There has been a growing consumer campaign against bank charges. | There has been a growing consumer campaign against bank charges. |
| Tens of thousands of bank customers have threatened to take their current account provider to court for the return of bank charges. | Tens of thousands of bank customers have threatened to take their current account provider to court for the return of bank charges. |
| They have argued that the charges are excessive and breach consumer law. | They have argued that the charges are excessive and breach consumer law. |
| To date the banks have avoided taking on consumers head-on in court. | To date the banks have avoided taking on consumers head-on in court. |
| Instead, banks have preferred to pay-up or have simply not turned-up to court hearings. | Instead, banks have preferred to pay-up or have simply not turned-up to court hearings. |
| Therefore, the OFT, with the agreement of the banks, has decided to take a test case over the scale and legality of their charges to court. | Therefore, the OFT, with the agreement of the banks, has decided to take a test case over the scale and legality of their charges to court. |
| If the OFT wins it could lead to hundreds of millions of pounds in bank charges being returned to customers. | If the OFT wins it could lead to hundreds of millions of pounds in bank charges being returned to customers. |
| However, if the banks win it will effectively bring the issue to a close and enshrine their right to levy charges on people who go into unauthorised overdraft. | However, if the banks win it will effectively bring the issue to a close and enshrine their right to levy charges on people who go into unauthorised overdraft. |