Banks start charging in order to recoup lost profits
- 13TH JUNE 2007
Here in Britain we have enjoyed free banking for many years, but there is speculation that is all set to change. Banks are now beginning to introduce fees for current accounts and those who send and receive a large amount of cheques and items such as overdrafts may now have to pay.
Not surprisingly in a recent survey conducted by YouGov for uSwitch, almost 83% of bank customers said they would change banks if fees were introduced.
It is thought one of the reasons behind the charges is down to payment protection insurance. Following the intervention of the Financial Services Authority and the referral of the market place to the Competition Commission which could see price capping on premiums and stricter sales practices, it is felt that banks will have to recoup their soon-to-be lost profits elsewhere.
Currently banks are notorious for charging high premiums on payment protection insurance (PPI), which means they rake in high profits from the product. However with the shake up that is to follow the investigation, it is thought there will be a crackdown on the way insurance is sold.
Currently around 19 million people have felt the backlash of bank charges and nine million of these have managed to claim back fees, with many more hoping to claim fees on a “no win-no fee” basis.
Simon Burgess from British Insurance welcomes any positive changes to the payment protection insurance sector which will be for the better of the consumer and has always been in favour of the consumer getting the best deal. British Insurance is an ethical and specialist payment protection insurance provider who can help you save up to 40% on a mortgage payment protection insurance policy and 80% on loan protection insurance, while selling you a quality product.
