You are here: Home - Saving & Banking - News -

Current account savers charged £10bn last year

0
Written by: Paloma Kubiak
05/02/2018
The average current account holder was charged £152 in bank fees last year but those with overdrafts are stung with much higher charges.

Analysis of over 11,000 UK personal current accounts revealed that the average holder was charged £152 in bank fees in 2017, including overdrafts, foreign exchange and transaction fees, as well as monthly account charges.

The research, conducted by financial chatbot Plum, suggests that if these charges were applied to each of the 65 million active current account holders in the UK, banks brought in £9.9bn.

However, this £152 rises significantly for those who have an overdraft. Plum said the charges were closer to £221 per current account holder with at least one overdraft transaction per year.

Taking a closer look at the charges, Plum said 56% were due to overdrafts, both arranged and unarranged. Foreign exchange fees accounted for 11% of the sum while late transaction fees made up 6%.

Other charges (27%) included monthly account fees, unspecified bank fees or bank subscriptions. Plum found that bounced-back transaction fees can be quite high, averaging £5-£10, and can accumulate quickly.

Plum launched in January 2017 and describes itself as a ‘personal money assistant’ connecting to users’ current accounts to analyse spending patterns before setting aside money to be saved. It has 100,000 users and claims to have saved them £24m.

It has now launched its free ‘Fee Fighters’ function allowing users to check exactly what fees they are being charged by banks as Open Banking makes this possible.

Victor Trokoudes, CEO and co-founder of Plum, said: “For too long, banks have been guarding customer data, and have been purposely vague about the true cost of overdrafts, borrowing, and FX. But with Open Banking now a reality, people can see in real time what charges they are being asked to pay by the banks and therefore take control of their money to avoid paying them.

“We want to help people stand-up to their banks and demand a competitive deal. The more people who switch, the more that banks will be forced to compete for their business and fight to retain loyal customers.”

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Are you a first-time buyer looking for a mortgage?

Look no further, get the help you need by searching for your perfect mortgage

Five ways to get on the property ladder without the Bank of Mum and Dad

A report suggests the Bank of Mum and Dad is running low on funds. Fortunately, there are other options for st...

The essential Your Money guide to the April 2018 tax changes

As we head into the 2018/19 tax year, a number of key changes take place to existing policies while some new i...

A guide to switching energy provider

All you need to know about switching from one energy supplier to another.

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Having a baby and your finances: seven top tips

We’re guessing the Duchess of Cambridge won’t be fretting about maternity pay or whether she’ll still be...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

YourMoney.com Awards 2018

Now in their 21st year, our awards recognise the companies offering the best products and services to consumers

Money Tips of the Week

Read previous post:
underpeforming funds
Who let the dogs out? Underperforming funds revealed

As the tide turns in stock markets, there are likely to be tougher times ahead for fund managers.

Close