Fee-free bank accounts to be launched in New Year.
BANKING AND CREDIT NEWS-December 29, 2015-Fee-free bank accounts to be launched in New Year
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HM Treasury on Sunday reported that millions of bank customers across the UK are expected to benefit by hundreds of pounds as nine banks launch their fee-free basic bank accounts from 1 January 2016.
Fee-free bank accounts will be available to anyone who doesn't already hold a bank account, is ineligible for a standard current account or who is unable to use their existing account due to fiscal difficulties. For the first time these bank accounts will be truly fee-free, allowing people to manage their money without fear of running up an overdraft.
This announcement follows an agreement last Christmas between the government and the banking industry to establish new basic bank accounts which will end bank charges if a direct debit of standing order fails. In some cases charges of up to GBP35 per failed item, and uncapped, meant that charges could roll into hundreds of pounds over time and drive people into serious debt.
Basic bank account customers will now be offered services on the same terms as other personal current accounts which are provided by the banks, which includes access to all the standard over-the-counter services at bank branches and at the Post Office as well as access to the entire ATM network. Currently there are thought to be around nine million basic bank accounts in the UK.
Head of the Financial Health Exchange at Toynbee Hall, Sian Williams, commented "We particularly welcome the commitment that the poorest and most vulnerable customers will be protected from the account fees and charges which can unintentionally lead to self-exclusion or unmanageable debt."
(EUR1 = GBP0.73)
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