Study highlights varied banking fees

CURRENT account holders who stay in credit in the Republic pay slightly higher banking fees than those in Britain and the North, according to research by the Central Bank.

However, the research also found that accounts that go “out-of-order” — ie, exceeding approved limits — pay lower fees in the Republic than Britain and the North.

The structure for charging fees varies considerably from one jurisdiction to another. Those who go into an unauthorised overdrafts pay the highest fees.

The Central Bank study covered AIB, Bank of Ireland, National Irish Bank, Permanent TSB, and Ulster Bank.

Bernard Sheridan, director of consumer protection, said: “Our research is evidence that out-of-order charges are the greatest driver in pushing up the cost of running a current account. It is important that, where possible, consumers limit the instances of out-of-order activity on their accounts.

“Consumers who find themselves continually in an unauthorised overdraft position or are being charged a number of out-of-order charges should engage early with their banks to agree a less costly approach. Savings can also potentially be made by using electronic transactions.”

The research looked at current account costs for four types of customer. It found that in 70% of cases, fees would be less than €120 a year.

In 60% of cases, fees for day-to-day transactions in the Republic would be less than €50 a year, but this would apply to 94% of cases in Britain and the North.

The Irish Banking Federation (IBF) said the Central Bank’s research showed that current account charges in the Republic were competitive and that good account management on the part of customers was key to minimising costs.

The IBF said the research illustrated the importance for customers of efficiently managing their accounts in order to keep costs to a minimum.

IBF member banks variously provide a range of information material as guidance to customers in this regard.