We scoff that banking costs in other countries, like in the US, where the equivalent of our current account comes with a fee. But if truth be told, all we have here are charged accounts hidden by smoke and mirrors.
Our banks pay us peanuts in credit interest, 0.45% on average, with the likes of Barclays paying nothing and NatWest a pitiful 0.01%.
Use an overdraft and you’ll pay too – god help you if you exceed your limit, because then you’ll really know how un-free our banking is.
And then there’s accessing your money abroad. Withdraw your cash outside of the UK and most banks will charge you 2.79% or more for the privilege.
So, not only do the banks get to use our stashed cash to earn a pretty penny by investing huge slabs of capital into equities, they also get to sting us by imposing lousy interest rates, under-the-radar fees and outrageous charges if we, as loyal customers, exceed our agreed limit.
The banks say that they’re going through a rough time right now, being battered by the likes of the Future of Banking Commission and the Government’s new independent Commission on Banking. Banks probably feel they need some support, but let’s face it; they’re not going to get it from their customers, given the way we’ve been treated.
Free banking doesn’t exist. What we have is unfathomable, hidden or confusing charges and no benefits. What I’d really like to do is vote with my feet and hide my cash under the floorboards, but that’s not sensible. So instead, I’d prefer to pay a flat fee up front and have done with it. At least that way I’d know what to expect.