Ulster Bank drops personal account charges

The Ulster Bank today became the second of Northern Ireland’s Big Four banks to bow to pressure and drop charges on personal current accounts.

From next month the bank’s customers will find they are no longer billed for transaction and account maintenance charges.

In addition customers with an agreed overdraft will enjoy fee-free banking for the first time.

Charges for direct debits and standing orders will also disappear from business accounts as well.

The move by the Ulster Bank – part of Royal Bank of Scotland – follows on from the Northern Bank which earlier this year created a new fee free account for those who remained within agreed borrowing limits.

The big difference for around 400,000 Ulster Bank customers is that they will not have to go through the hassle of opening a new account – the ending of charges will apply to their existing accounts.

Attention will now switch to the remaining members of the Big Four – the Bank of Ireland and First Trust – to see how they respond.

All the banks are currently under investigation by the British Competition Commission following the lodging of a Super Complaint over alleged excessive charges with the Office of Fair Trading by the Consumer Council.

Welcoming the announcement from the Ulster Bank, the Consumer Council’s chairman Steve Costello said it was another breakthrough for Northern Ireland’s long suffering banking consumers.

He added: “We particularly congratulate the Ulster Bank in taking responsibility for switching customers onto the new charging structure; for once the onus is not on the customer.”

However he had harsh words to say about new charges for unauthorised overdrafts.

“The Consumer Council believes that these new unauthorised overdraft charges are excessive. We will be taking up this issue with the Ulster Bank as well as the Competition Commission and the Office of Fair Trading,” said Mr Costello.

He said while the council encouraged banking customers to manage their money within limits agreed with their bank, there were many occasions when customers may find themselves exceeding their limit – often unwittingly.

“People who find themselves in this situation could be much worse off than before,” he said.

The council, he added, would continue to press all banks to follow the lead of the Northern and Ulster.

In the meantime customers who felt they were not getting a good deal from their bank should “vote with their feet” by switching to a bank that would treat them well.

Ulster Bank retail banking chief executive Mike Bamber said the new account structure would reinforce the Bank’s position in Northern Ireland.

“To retain and grow our customer base it is essential that we continue to listen to them and continue to improve our services.

“The new charging structure represents another step forward in terms of quality, economy, competitiveness and benefits.”

He said the new accounts were the best value-for-money there was. “There is nothing like this and nothing better in Northern Ireland.”

Every customer would be informed of the changes by letter and more than 400,000 would be better off from November 15, he said.

Mr Bamber described changing the personal accounts to the new structure as a “huge undertaking” in terms of information and communications technology.