FINANCE
Paul Lewis
Current accounts are free, but many of us pay monthly fees for premium ones, which include extras such as cashback and insurance. Are they worth it?
by PAUL LEWIS
PAUL LEWIS/ MY MONEY/ SAGA SPOTLIGHT
Why pay for something that is free? That is what I always ask whenever anyone says they are paying for a premium current account. With a free current account, our money is stored and safe. There is no charge for that and we can take our cash out free at 40,000 machines and 11,400 post offices. We can pay someone else or a small business almost instantly online. Even cheques have had a makeover and are quicker and easier than ever now that they can be paid in as digital images. We pay nothing for all these services. In most other countries, banks charge for them.
Banks in the UK would like to charge us but they cannot for two reasons. If one began to charge for all current accounts, most customers would simply move to another that did not charge, using the easy and free Current Account Switch Service -and perhaps get a £100 gift from the new bank. But if they all agreed to do it at the same time they would be breaking competition law and face, at best, massive f:mes. So they are stuck with free banking.