Momentum gathers to end free banking.

This is the title of the web page at
http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/9288736/Momentum-gathers-to-end-free-banking.html

The question is why does anybody want to end free banking?

Don’t the banks make enough money already?

“Andrew Tyrie, chairman of the committee, urged regulators to clear away any obstacles stopping banks from charging and to bring the 28-year-old practice to an end.

A groundswell of support for change is understood to be gathering among the authorities. The Treasury’s advisers on the Independent Commission on Banking and the Office of Fair Trading are said to be also backing the proposals, alongside the treasury select committee and financial regulators.”

But the public reaction is completely different. The poll on this web page is currently at over 84% in favour of free banking on your current account, which is what I would have expected. Ok, so there are maybe some risks that you could be caught with “Stealth charges” somewhere, but it is always up to the customer to read the fine print – even when working with a bank. I see no requirement at all for regulation to save people from themselves!

In any case, there are alternatives. Do you really need a checking account? If not, a Savings account might do the job equally as well, and would certainly be less costly to run. Even in Germany, (admittedly some years ago now), a specified number of entries were free each month, and as the account would service your standing orders and everything else, as long as the bank was nearby, there was no need for a current account at all.

No, I think the banks have been pampered enough. We bail them out when they go broke, we nationalize them to keep them afloat, and hand them back when they are solvent again, do we really need to add insult to injury for the long-suffering customer?

I think not!

The poll is a good indication of how out-of touch the government is with public opinion, and this applies not only to banking I suspect.
Don’t hold your breath waiting for something good to come of it!

Advertisements