Is the end in sight for free bank accounts?

Until now banks and building societies have offered us free current accounts, unlike many of our European counterparts.

Now, however rumours are rife that this is all set to change.

First Direct made a move in this direction last November when it imposed a monthly fee on ‘some’ current accounts.

The proposal has left the industry divided in their views.

On the one hand Alison Melville from IVA.co.uk (an advisory site on various   finance and debt management matters) believes that some people who would be forced to pay a monthly fee ironically are the very ones who can least afford it and then there are those already struggling with their debt management.

She is afraid that anyone not perhaps maintaining a certain figure in their current account may be further penalised by encountering fees as a result of this.

On the other hand, we have Graham Beale (who in April will take over as Nationwide’s Chief Executive) advocating fees as reflecting current account costs.

He believes that in an ideal world the costs would be shared and argues that a branch must pay for the installation and running of an ATM for example, and therefore the customer should contribute to these costs and not just to expect access to the ATM for free.

He indicates that he will watch the industry in general before making a decision whether to impose fees or not.

No doubt there will be far more viewpoints shared on this subject in the near future.