Guiding consumers since 2009

UK report: So much for 'free' banking

By Staff Writer

By Michael Coulson, Fin24

One of the first columns I wrote for Fin24.com concerned the fees private clients are charged by SA banks. I warned that though these might be exorbitant - as was confirmed by the subsequent inquiry - comparisons with the "free" banking allegedly offered in countries like the UK may be misleading. And so indeed it has proved.

An inquiry by the UK government's Office of Fair Trading, released late last week, claims that concealed and sometimes irregular charges on current accounts tot up to an amazing £8.3bn a year, or an average of £152 on each of the 64m accounts.

The biggest items come from £4.1bn interest the banks earn on current account balances - which seldom pay interest to the account holders - and £2.6bn charges on customers who exceed their overdraft limits.

Justmoney.co.za says: Michael Coulson explodes the myth of UK "free banking". HSBC alone set aside million of pounds last year to settle claims against customers who felt they had been over-charged or charged incorrectly with punitive fees.

However, this should also be a warning to South African banks to get their houses in order with fair and transparent bank charges.

Recent Articles

Featured Debt Series Part 2: Interest rates - unpacked

In the second part of our Debt-ucate series we explore interest rates –from how to get a better rate to what influences it, and how this affects the cost of your debt.

Debt counselling – the two sides of the coin

Being overindebted doesn’t just put a strain on your personal finances; it also puts a strain on your state of mind. The best solution is to start the process of debt counselling so that you can escape the debt cycle. But what are the ups and downs of joining this debt relief programme?

Travel ban – how to claim for the loss incurred

As with the recent Covid-19 pandemic, governments sometimes issue travel bans to prevent people from travelling to other countries. This becomes even more complicated if you’ve already planned and paid for your trip. Your flights will be cancelled, and you may lose money from cancelled accommodation arrangements. How do you claim for the financial losses incurred due to a travel ban?

How to finance and insure a second-hand vehicle

Buying a second-hand vehicle may suit your budget better than acquiring a new one. But what impact does an older model have on vehicle finance and car insurance? We reached out to specialists in the field to explain what the financial implications are of pursuing a second-hand vehicle.

Deals

Get 30% back when you fill up with your Absa card

Price: Available on request
When: Daily
Where: Nationwide

Get 50% back in eBucks when you apply for an FNB home loan

Price: Available on request
When: Daily
Where: Nationwide

Get 50% off your online fees when you pay with Capitec card

Price: Available on request
When: Daily
Where: Online