HSBC says it could charge for current accounts

RG2015

born_again said:

Eco_Miser said:

There is confusion here between 'basic bank accounts' which are very limited in function and usually limited to people who don't qualify for anything else (which HSBC has pledged will remain free), and 'standard current accounts' which are no-frills, no credit interest, no minimum pay-in or balance accounts, for which banks may one day charge.

Banks already charge for accounts with incentives, but waive the charges, or provide incentives exceeding the charges, if various conditions of minimum use are met.

Well that is not a basic account...
adamp87 was referring to a Basic account. 

Your highlighted bit is a description that @Eco_Miser has given for a standard account when they are comparing it with a basic account.

Roger.Wilco

There has been quite a bit of chatter on the Interwebs regarding UK Banks (maybe/possibility) charging for current accounts in the (near/medium) future. An example from earlier this month:

The end of free bank accounts is bad news for Monzo and its rivals

https://www.wired.co.uk/article/monzo-starling-negative-interest-rates

If the base rate turns negative, both neobanks and incumbents will suddenly have to start paying interest to hold money with the central bank. This is a much more worrying scenario for neobanks, because they have not yet built loan books large enough to offset the costs of what they’ll have to pay in negative rates.

...

There is one clear silver lining for neobanks. On 12 October, the Bank of England and the Prudential Regulation Authority wrote to British banks requesting information on their “operational readiness” for negative interest rates – and were particularly keen to get a sense of the technological problems negative rates would pose.

So if the base rate goes negative - then expect exactly the same for banking customers...  though for banking customers negative interest rates will be in the form of account fees.

born_again

RG2015 said:

born_again said:

Eco_Miser said:

There is confusion here between 'basic bank accounts' which are very limited in function and usually limited to people who don't qualify for anything else (which HSBC has pledged will remain free), and 'standard current accounts' which are no-frills, no credit interest, no minimum pay-in or balance accounts, for which banks may one day charge.

Banks already charge for accounts with incentives, but waive the charges, or provide incentives exceeding the charges, if various conditions of minimum use are met.

Well that is not a basic account...
adamp87 was referring to a Basic account. 

Your highlighted bit is a description that @Eco_Miser has given for a standard account when they are comparing it with a basic account.

This all stems back to this post..

adamp87 said:

Whoever is the first bank to take the hit & bring this in for basic accounts, if they did would probably see large closures as people move elsewhere.

Which is clearly NOT what HSBC stated. Others then seemed to have got "Basic Account"  confused with a normal bank account.
There is a very distinct difference.

keiran

Interesting that it was Midland Bank ( a predecessor of HSBC) which introduced free banking to the UK in the 80s

stclair

The FCA might step in to stop it should it happen. The banks may shoot them selves in the foot as someone’s not going going to want to pay for multiple accounts. 

eskbanker

stclair said:

The FCA might step in to stop it should it happen.

On what grounds?  There are already plenty of banks levying charges for bank accounts, while simultaneously offering free ones....

stclair

eskbanker said:

stclair said:

The FCA might step in to stop it should it happen.

On what grounds?  There are already plenty of banks levying charges for bank accounts, while simultaneously offering free ones....

They generally have a perk(s) attached to them

eskbanker

stclair said:

eskbanker said:

stclair said:

The FCA might step in to stop it should it happen.

On what grounds?  There are already plenty of banks levying charges for bank accounts, while simultaneously offering free ones....

They generally have a perk(s) attached to them

Indeed, mostly, but if FCA-regulated banks such as Triodos charge for current accounts without perks, then on what specific grounds would the FCA step in if others choose to do the same?

jackjones01

I think if the whole industry did it I think the regulators would step in so I agree. Even in America you have ways you can avoid the account fees such as minimum pay ins etc. 

RG2015

jackjones01 said:

I think if the whole industry did it I think the regulators would step in so I agree. Even in America you have ways you can avoid the account fees such as minimum pay ins etc. 

There may be some concern if there was collusion but I am not sure even that would interest the FCA.

I still find it amazing that large corporations can offer a sophisticated financial product free of charge, and cover their costs by exorbitant charges for other services.