Is it time to end ‘free’ banking?

Gordon_the_Moron

I don't see the problem with them cross selling products which is part of the profitability of current accounts, they absorb interest on credit balances, they charge interest on overdrafts (don't like it don't use them!) they charge fees for breaking terms (don't like it don't do it!) this in itself is enough to make current accounts profitable without charging.

Unless they were forced by law to charge I can't see it happening anyway, one bank would offer it for free whilst the other all charged and take a shed load of customers off all the others.

chinchin2010

What's the point of the FSA? I thought it was to safeguard the interests of consumers of financial products. Thanks to them, from the end of this year I will have to pay my ISA provider for a service which is currently free. Now they want to end my free banking as well. As far as I'm concerned, this is a quango we could well do without. I lend my bank several thousand pounds every month and don't get paid any interest on it. I therefore expect a free banking service in return.

SCO

The question options seems a bit biast towards a change to fee's.

Just because you are paying a fee does not mean the banks will be transparent.

aldredd

WestonDave wrote: »

Its not the system that is broke - its poor banks and poor financial management by customers that causes issues.

But, the problem is that it's the 'poor management by customers' that allows you to have free banking.

I've been there myself - you have a 'bad' month, charges get whacked with a load of un-affordable charges meaning the following month it all happened again, and so on.
So, I have 6 months of hell, paying disproportionate charges - so you can enjoy 'free' banking.

You think that's a fair system?

(thankfully, I got it all sorted and now in a position where I shouldn't face such issues - and yes - managing my finance is my responsibility - but managing your finances by subsidising through high charges isn't.)

Mishomeister

aldredd wrote: »

So, I have 6 months of hell, paying disproportionate charges - so you can enjoy 'free' banking.

You think that's a fair system?

Well, for example I do personally think it is a fair system. And yes I am very happy for you to subsidize my free banking.

Taking someones(bank's) money without permission is a theft so I think it is those who commit it have to pay not the ones who don't.
I've never been overdrawn myself so clearly don't see the reason why should I through monthly fees subsidize a cheaper banking for you.

aldredd

Mishomeister wrote: »

Well, for example I do personally think it is a fair system. And yes I am very happy for you to subsidize my free banking.

Taking someones(bank's) money without permission is a theft so I think it is those who commit it have to pay not the ones who don't.
I've never been overdrawn myself so clearly don't see the reason why should I through monthly fees subsidize a cheaper banking for you.

Yes, you're right - an employer screwing up someones wages who then gets a 190 odd quid charge from the bank is a absolutely theft.

why should I through monthly fees subsidize a cheaper banking for you.

soo - you're OK for others to subsidise YOU, but YOU don't want to subsidise others (which you wouldn't be anyway, with the intention being everyone pays THEIR own share of the cost associate with banking).
Yeah, really fair that one.

MSE_Martin

psdie wrote: »

Silly poll - what on earth makes anyone think the banks would stop pushing money making products just because they've covered their AC management costs?! Or that they'd reduce the fees on totally unrelated products like mortgages?

Banks already make money from the difference between the interest they pay on positive balances (usually zero or negligible for current accounts) and the return they receive from investing / leveraging / lending those balances.

Is MSE going to start advocating a return to charged cash machines in order to be "more transparent"? Bizarre!

Please don't confuse us running a poll with it being our opinion. If you read earlier in the thread you'll see I made exactly the same point as you. The comment about it reducing fees elsewhere is from Adair Turner, the head of the FSA.

THe reason for doing a poll is I thought it useful information to feed into the wider debate. Yet it is important that when writing a poll, we try not to bias it one way or the other.

Martin

NeverInDebt

I dont think its ever been free, businesses wont be around if they did things for free. There is always a cost involved its just not always transparent ie lower interest on accounts. Banks probbaly find it more profitable on some customers than others though. If like me you do go over drawn and yes I not a fantastic income but savvy and managed to save a little I dont go over drawn and have a limit with the bank if I ever did so would only costs me a little if I paid back quickly which I never do borrow. I just live within my means

Mishomeister

aldredd wrote: »

Yes, you're right - an employer screwing up someones wages who then gets a 190 odd quid charge from the bank is a absolutely theft.



soo - you're OK for others to subsidise YOU, but YOU don't want to subsidise others (which you wouldn't be anyway, with the intention being everyone pays THEIR own share of the cost associate with banking).
Yeah, really fair that one.

The main point is at the moment you can choose if others subsidize you(by keeping your account in 'black' or you subsidize others by going in to unagreed overdraft) If charges introduced than this choice is gone). If you are really strap for cash something like a payday loan is steal cheaper than unagreed overdraft. If you chose to go overdrawn and pay the fees as a result and based on that banks do not charge me for anything why should I dislike the system.

Jo09

aldredd wrote: »

Yes, you're right - an employer screwing up someones wages who then gets a 190 odd quid charge from the bank is a absolutely theft.

Surely your employer should reimburse you then?