With a new report suggesting that banks made more than £1bn in overdraft charges last year it really is time to put the ‘free banking’ myth to bed.
We don’t have free banking in this country, and we haven’t had for years.
We pay for our bank accounts in a variety of different ways, including overdrafts, packaged accounts and the difference in the rates of interest charged to borrowers and passed on to savers.
And of course we as customers are continuing to pay for the billions of pounds that the bank have to set aside as compensation for the farce that is payment protection insurance.
Another report out today suggests that there should finally be a deadline set to end claims for these mis-sold policies and while some consumer groups suggest that this will unfairly discriminate against those who have yet to claim it’s surely time to stop allowing banks to hide billions of pounds in their balance sheets to be set aside for ‘future ppi claims’.
This is a subject for another day but I can’t help feeling that the next financial scandal we will have to deal with is the one surrounding the industry that has grown up around PPI claims and the companies that are systematically milking consumers of millions of pounds in compensation. They tell us that they are only helping customers to claim what is rightly theirs but if the banks had handled the claims property in the first place we wouldn’t be sitting here writing about this today – it could have gone away years ago.
The bottom line is that we don’t know how much we’re paying to operate our bank accounts and the banks do as much as they can to keep the true costs of our banking hidden from view.
Of course it has to be this way at the moment, the banks will tel us, because that’s the only way we can avoid making direct charges for account holders to open accounts.
Well perhaps that would be a more open, honest and transparent way to operate their businesses but then again expecting openness honesty and transparency from a banker is like expecting………well, its not easy!