FCA 'won't stand in the way' of an end to free banking, says boss

Kim_13

steven141 said:

Kim_13 said:

steven141 said:

If banks started charging for every account, I would probably close a lot of my secondary accounts. 

I currently have the following current accounts:

Royal Bank of Scotland x 1
NatWest x 1
Ulster Bank x 1
Nationwide x 2
Lloyds Bank x 1
Chase x 1

I also have 9 savings accounts and 2 credit cards.

I know that this seems excessive but the NatWest and Ulster Bank accounts opened for the switching deal and I'm keeping them and going to use them in some way as an appreciation for my £600 I gained from NatWest Group. 

The rest all have their purpose in some way  

I'm a couple behind you.

Halifax into which I am paid and bills out (and they offer the facility to pay in a cheque via app.) 

Chase for spending.

Nationwide (closest branch, my only chequebook if a cheque is needed and my oldest account, receiving Premium Bond prizes.)
 
The others I have less of a need for: 

NatWest - They were my main account once upon a time, but I had a far better experience with Nationwide and switched out once the difference in age between it and Nationwide was minor. Rejoined in 2022 for the Digital Regular Saver and a switch bonus.

Metro - Switching in future, but that's optional, so I would find it less objectionable to have to pay or close. The others are either required for me to be able to manage my finances effectively or because of a stipulation by the bank.

Savings accounts... lost count.

I have my Royal Bank of Scotland account open for the reason of having had it a long time. I do like different banks for different things and if I just had one then I feel like I’d always feel like I’m missing out on something as I like the way that more than one works and it’s handy if one goes down like mentioned by someone previously. 

My current account setup feels like the optimum between streamlining and avoiding missing out on something. Credit file nice and tidy too, 5 open current accounts and 5 closed current accounts 🤣

steven141

Kim_13 said:

steven141 said:

Kim_13 said:

steven141 said:

If banks started charging for every account, I would probably close a lot of my secondary accounts. 

I currently have the following current accounts:

Royal Bank of Scotland x 1
NatWest x 1
Ulster Bank x 1
Nationwide x 2
Lloyds Bank x 1
Chase x 1

I also have 9 savings accounts and 2 credit cards.

I know that this seems excessive but the NatWest and Ulster Bank accounts opened for the switching deal and I'm keeping them and going to use them in some way as an appreciation for my £600 I gained from NatWest Group. 

The rest all have their purpose in some way  

I'm a couple behind you.

Halifax into which I am paid and bills out (and they offer the facility to pay in a cheque via app.) 

Chase for spending.

Nationwide (closest branch, my only chequebook if a cheque is needed and my oldest account, receiving Premium Bond prizes.)
 
The others I have less of a need for: 

NatWest - They were my main account once upon a time, but I had a far better experience with Nationwide and switched out once the difference in age between it and Nationwide was minor. Rejoined in 2022 for the Digital Regular Saver and a switch bonus.

Metro - Switching in future, but that's optional, so I would find it less objectionable to have to pay or close. The others are either required for me to be able to manage my finances effectively or because of a stipulation by the bank.

Savings accounts... lost count.

I have my Royal Bank of Scotland account open for the reason of having had it a long time. I do like different banks for different things and if I just had one then I feel like I’d always feel like I’m missing out on something as I like the way that more than one works and it’s handy if one goes down like mentioned by someone previously. 

My current account setup feels like the optimum between streamlining and avoiding missing out on something. Credit file nice and tidy too, 5 open current accounts and 5 closed current accounts 🤣

I am slightly like that too but I may eventually close my Chase account if they do away with the cashback offer and switch my spending across my Ulster Bank and NatWest accounts. I do have a budget and account for different things currently 😊

I don’t know how people manage with one bank account for everything not even a savings account. 

subjecttocontract

Don't assume that if UK banks start charging it'll just be one annual fee. There will be all sorts of add on's......charge for a debit or credit card, charge to make d/debit's or s/order's etc etc. The more you use it, the higher the fee and so on. 

jameseonline

I have no idea how many savings accounts I have tbh, it's a lot though, when I started savings a few years ago I setup a ridiculous number of poopy NatWest & RBS savings accounts, gave them names with intentions to sort myself out with getting bank/savings accounts in future making sure I could have something to put into the accounts if I got them, tbh it was a dumb thing to do but I don't think savings pots etc were a thing when I started or were definitely not on my radar, still got them, what's more dumb as is NatWest and RBS didn't seem bothered what I was doing and kept sending me all the booklets etc to do with the accounts.

Skip forward to now, I've basically completed what I set out do & more, I'm with most high street banks, building societies etc that are available to me, only 1 I don't have is a Metro Bank account (there's never really been a point in getting 1 for me & tbh doubt there ever will be) having recently got myself a co op current account (because I want their regular Saver but that's not gone well so far bit hey gotta try) , it been a lot of work to get to where I am and I'm pretty proud of what I've done in such a small amount of time.

Part of the reason I recently joined this forum is to help pass my knowledge/experience on in regards to current & savings accounts (possibly other things too but I don't have a clue about loans, mortgages, credit cards etc so don't ask me about them🤣) part of where I am now is down to the MSE website/Martin Lewis, I've even made suggestions to the site in regards to accounts to list & in some cases managed to get this site to get them listed.

Do I need so many savings accounts?, current accounts?, honestly?, no but at the same time I don't want rid of them either, might get rid of a few but if I don't want or need to nah, unless the banks etc want to close them I can't do f all about that🤣

jameseonline

steven141 said:

If banks started charging for every account, I would probably close a lot of my secondary accounts. 

I currently have the following current accounts:

Royal Bank of Scotland x 1
NatWest x 1
Ulster Bank x 1
Nationwide x 2
Lloyds Bank x 1
Chase x 1

I also have 9 savings accounts and 2 credit cards.

I know that this seems excessive but the NatWest and Ulster Bank accounts opened for the switching deal and I'm keeping them and going to use them in some way as an appreciation for my £600 I gained from NatWest Group. 

The rest all have their purpose in some way  

Compared to me that isn't excessive, you've done that to benefit you and or others, it's money you didn't have 

ZeroSum

subjecttocontract said:

Don't assume that if UK banks start charging it'll just be one annual fee. There will be all sorts of add on's......charge for a debit or credit card, charge to make d/debit's or s/order's etc etc. The more you use it, the higher the fee and so on. 

If they go to that extreme, then people will just start using cash again. Which is exactly the opposite to what the banks want.

TheBanker

subjecttocontract said:

Don't assume that if UK banks start charging it'll just be one annual fee. There will be all sorts of add on's......charge for a debit or credit card, charge to make d/debit's or s/order's etc etc. The more you use it, the higher the fee and so on. 

I don't think we'll see charges for holding an account any time soon (other than the type of charge we already see, e.g. £3 a month for a Santander Edge account which you can more than cover with the cashback, or accounts where you're basically paying the bank for travel insurance and breakdown cover). No bank will dare to introduce charges for a standard account, because they know their customers will go elsewhere. New enterants like Chase, who don't have the same costs as 'traditional' banks will take advantage and hoover up lots of customers.

And the banks can't all introduce charges together, because that would look like collusion and probably result in a competition investigation.

So I think we'll carry on with the current model where standard accounts are free, but you might choose to pay for some 'extras'.

I wonder if some of the high street banks might start charging for counter services, to cover the ongoing cost of the branches rather than relying on cross-subsidy from the majority of customers who never go near the branch. Personally I would charge for issuing chequebooks because they're old fashioned and unnecessary. And I might charge for paper statements. Not excessive charges, just to cover the cost of printing and postage.

If we do ever get to a position where banks charge for holding an account, I think we'll see a mixture of models. Some will charge per transaction, some will charge a flat monthly/annual fee, some will have a hybrid model where the flat fee allows a certain number of transactions, with additional charges for going over the limit. Some might link charges to your balance. That's exactly how the business bank account market works, personal banking wouldn't really be any different. 

eskbanker

TheBanker said:

And the banks can't all introduce charges together, because that would look like collusion and probably result in a competition investigation.

Perhaps that's the way it should work in theory, but in practice there's unlikely to be any action IMHO, based on the precedent of the change to overdraft charging regime a few years back, when the majority of banks gravitated to exactly the same 39.9% rate, at which the FCA bumped its gums a bit and harrumphed about whether this was justifiable, but ultimately backed down and failed to pursue the matter.

subjecttocontract

We've had a joint Spanish non resident bank account for over 20 years so are used to paying for having an account. I think it works out to around £100 a year.  We were each paying for bank cards but now just have one to cut the charges a little. 

WillPS

subjecttocontract said:

Don't assume that if UK banks start charging it'll just be one annual fee. There will be all sorts of add on's......charge for a debit or credit card, charge to make d/debit's or s/order's etc etc. The more you use it, the higher the fee and so on. 

I'd welcome physical debit cards becoming optional and chargeable to be honest. I have a binder full of them, most of them are never used for anything physically, ever. It's part of this 'hobby' that does my head in to be honest as it feels incredibly wasteful.

There are maybe 3 debit cards I actually want. The rest is just unnecessary but unavoidable* junk. Same goes for Balance Transfer credit cards - literally zero need for a physical card, yet no option not to have one.

* other than just not having the account

Same goes for printed statements, that's an unnecessary expense for most.