Consumers urged to ask banks for fee reductions

Consumers were today urged to negotiate with banks to have fees and charges on their accounts reduced.

In its latest survey of the banking sector, the Financial Regulator revealed significant differences in costs for various business current accounts provided by the country’s six leading banks.

But the watchdog warned people to take other factors into consideration.

Mary O’Dea, Consumer Director, warned: “While the cost of banking services for your business is very important, there are others factors to consider, such as the level of service and the availability of dedicated business banking staff.

“These factors are as significant as cost as they are important for the efficient running of your business.

“Remember, even if you do not want to switch your account, it is often possible to negotiate with your bank to have your fees and charges reduced.”

The survey showed fees and charges for eight different business current accounts offered by six banks, Allied Irish Bank, Bank of Ireland, Ulster Bank, NIB, Bank of Scotland and Permanent TSB.

It found:

:: Transaction charges vary across business current accounts. The more you use your account, the more you will pay in charges.

:: Interest on authorised overdrafts ranges from 6.85% to 9.25% while surcharge interest on unauthorised overdrafts ranges from 0% to 9%.

:: Many of the surveyed banks do not pay interest on credit balances, but for those that do pay interest, it ranges from 0.05% to 2.5%, the latter on balances over €500,000.

:: Better value is available through electronic banking.

:: All banks charge for duplicate statements so firms should keep copies of all statements to save on this cost.

The regulator suggested consumers ask three questions when selecting a business current account.

:: Does the bank have dedicated staff for your business?

:: What are the fees and charges on each account offered?

:: What services does the bank offer?

The regulator also revealed that from July, a new switching code will be introduced to make it easier for businesses to move their accounts.