Top Banking News

Derin Clark

Derin Clark

Online Reporter
Published: 06/03/2020

From today, Virgin Money current account holders will be able to make transactions using their debit card while abroad without incurring any foreign currency fees.

Virgin Money Current Account customers can now make payments and withdrawals from cash machines while abroad without being charged. Previously, customers were charged 2.75% on foreign currency purchases and 3.75% on cash withdrawals, with a minimum charge of £1.50 per transaction for each, when using their Virgin Money debit card abroad.

This account is available to over 18s if opened online or over 16 if opened in branch. It includes an overdraft facility. The fee on overdrafts will depend on the customer’s credit score, but Virgin Money has stated that the majority of its customers will be on a rate of 19.9% EAR. The overdraft facility is only available to those aged 18 and over.

Commenting on the removal of foreign transaction charges, Zack Hocking, head of personal deposits at Virgin Money said: “We launched our new Virgin Money current account to offer the best in digital and mobile technology and help customers manage their money easily. Removing foreign currency fees makes using the account even more straightforward, giving customers the certainty of having no additional fees or charges when paying in a foreign currency using their debit card or taking cash out when abroad.”

The most recent results for bank service standards from the Financial Conduct Authority (FCA) show that although there has been progress in some areas of customer service, banks are still failing to improve in others – most notably in replacing lost debit cards within one day.

The FCA customer service report is issued quarterly and illustrates how quickly individual banks and building societies take to process several common banking tasks. The aim of this is to educate consumers on their bank’s performance and encourage them to switch to a better performing provider.

Find out more about the independent service quality survey with our guide: How satisfied are consumers with their banks?

With both HSBC and Virgin Money revealing that they will both be closing branches this year, we take a look at how ongoing branch closures are impacting consumers.

Consumers who regularly use their overdrafts will start seeing the impact of the overdraft fee changes, with some arranged overdraft borrowers seeing their charges nearly double.

The majority of high street banks have made changes to their overdraft charges in response to the Financial Conduct Authority’s (FCAs) ban on fixed overdraft fees, along with its ruling that unarranged overdraft fees cannot be higher than those charged on arranged overdrafts.

While for some consumers this will mean that they will be paying less for borrowing through their arranged overdrafts, for others it will make borrowing this way more expensive. Rachel Springall, finance expert at Moneyfacts.co.uk, explained: “Banking customers who dip into their arranged overdraft facility could well find they are paying double the amount in charges as a result of firms repricing their tariffs to meet the FCA’s fixed fee ban. The much-needed overhaul of the charges has been a double-edged sword for some, while Barclays, Halifax, Lloyds, Monzo, Santander and Virgin Money are among those providers that will charge less*.

“Meanwhile, Metro Bank has recently announced it will charge customers £6.40 more*, hiking its 15.0% rate to 34.0%, even though it did not charge usage fees before and was one of the most competitive tariffs on the market. Other challenger banks do not appear to be following suit though, in fact Monzo will charge 19.0% instead of £0.50 per day and save customers £7.80*, Starling Bank will keep its 15.0% rate and Virgin Money’s new tariff will save customers £3.34*.

“The banishment of the most extortionate fees among the biggest brands could result in an astonishing saving, Barclays Bank Account customers will save over £10 in charges* when using their arranged overdraft – but any savings will depend on the provider and current account someone holds. This then could spur consumers to switch as they will also now be able to compare overdraft tariffs much more easily now that usage fees are banned.

“As some of the most well-known brands are pricing their tariffs between 35.0% and 39.9%, there isn’t too much difference to choose between them for a cost-saving, so we could see an uplift in customers switching to challenger banks that are a cheaper alternative.”

Royal Bank of Scotland (RBS) has announced today that it is offering new and existing customers £175 to switch their main bank account to the high street bank before 20 April 2020.

Customers will be able to get the £175 if they switch their main bank account to an RBS Select, Premier Select, Reward, Premier Reward, Reward Silver, Reward Platinum or Reward Black account, using the Current Account Switch Service. In order to receive the money, customers must pay £1,500 into one of these accounts and log into online or mobile banking through the RBS mobile app before 24 May 2020. Customers who meet the terms and conditions will then receive the £175 before 19 June 2020.

The RBS Select account has no monthly fee and offers customers its GetCash service, which allows them to withdraw money from a cash machine without their bank card using a passcode sent to their mobile phone. Alternatively, its Rewards accounts charge a monthly fee but offer customers cashback incentives.

This announcement follows a similar switch incentive launched by NatWest earlier this month. Both banks are owned by the same company.

Commenting on the switch offer, Bruno Genovese, head of current accounts at Royal Bank of Scotland, said: “Switching bank accounts couldn’t be easier and we hope our highest ever guaranteed switcher offer will give an added incentive for those who have been thinking about switching to a bank that can help make you more confident about money.”

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