Do you pay for your bank account? If so, it's probably by choice rather than necessity, perhaps because of the package of added extras you can enjoy. Many people still prefer to conduct their everyday banking activities using a fee-free account, but there are increasing fears that this may not be possible for long.
According to research from Consumer Intelligence, just 44% of those surveyed are confident that free bank accounts will be around for the foreseeable future, believing that fees for having an account will never be introduced. At the other end of the scale, 24% expect current account charging to be widely launched within two years, putting an end to free banking sooner than many anticipate.
Would you switch current account?
The research also highlighted a clear lack of switching, with 67% of banking customers saying they're happy with their current bank and 47% having never switched. In fact, 30% have been with the same bank for at least 20 years and 54% have stayed put for more than 10 years, with only one in 20 customers having held their main current account for less than a year.
A key reason for this low level of switching seems to be a disbelief in account variations, with 25% believing that there's little point in switching because most current accounts are the same. However, if widespread charging was introduced, things could quickly change, with 67% saying that they'd start looking for a new account if their bank started charging £5 a month or less.
"Free in-credit banking has come to be regarded by many as virtually a birthright, but it would appear that many customers are no longer as confident that it will survive," said David Black of Consumer Intelligence. "The threats of break-up and branch sell-offs as a result of the [competition] investigation could trigger the end of free banking, which ironically enough would be the biggest ever spur to switching.
"There have been a number of new entrants to the current account market in recent years, such as M&S Bank, Metro Bank, Tesco Bank and Virgin Money. But the reality is that most people just don't switch their current account."
So, would you be tempted to switch account if your bank started charging you? Alternatively, you may already be thinking about taking the plunge, even if it means paying. Some fee-charging accounts offer a range of added extras, including insurance, breakdown cover and even access to preferential savings rates, so it could be worth having a browse.
Then, of course, there are current accounts that may waive the fee if you deposit a certain amount each month, letting you avoid the fee but reap the benefits. There's plenty to think about when it comes to current accounts and they're not all created equal, but happily, there are still free and fee-charging accounts readily available. Start your search to see if it's time to make the big switch.
Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.
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