Warning fired over fee-paying bank accounts

A price comparison firm has warned that UK consumers are being left out of pocket by fee-paying bank accounts.

MoneyExpert is convinced that people who are making use of so-called packaged accounts are paying an average of £11.61 for the privilege but are getting very little in return.

The incentives that are offered by banking groups in an effort to attract consumers to fee-pay accounts can often seem attractive but tend not to be good value for money in the long-term, the company has claimed.

Some people use packaged accounts because of the promise of cheap credit card debt in return, but this and other incentives can be secured elsewhere for those who take the time to seek them out.

“The basics of a typical fee-paying current account are frankly terrible value for money,” said Sean Gardner, chief executive of MoneyExpert.

“You don’t have to be a mathematician to see how an average interest rate of just 2.1 per cent compares to free banking if you have to pay a typical fee of £11 for the privilege.”

Earlier this week, the Nationwide Building Society warned that British holidaymakers could be adding to their credit card debt unnecessarily by remaining liable to foreign currency loading fees while spending outside the UK.

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