Bank Charges
How much will I be charged for having a bank account?
In the U.K., you can still get a current account for free, but you may also be offered what is termed a package account. A package account is an account that charges a monthly fee in return for benefits like travel insurance or home insurance. However, you can still get a current account for free.
How much will I be charged for having an overdraft?
Generally, there's no fee for arranging an overdraft facility, but if you do use that facility, you will be charged interest on that money. If you've breached the overdraft limit that you've agreed with your bank, you will be charged an even higher rate of interest and you'll also be charged a fee.
What other fees are there?
Generally speaking, you shouldn't see any other fees on your current account if you operate it in a sensible way. The things that the bank might charge you for are bounced direct debits or bounced checks or returned standing orders. It's worth checking what your bank will charge you if you do breach these particular limits, but if you operate your account sensibly then you shouldn't see any fees.
Why do banks charge their customers?
It's actually unlawful for banks to profit from any default fees that they might charge you. A bank is only allowed to cover the costs of dealing with your default on your bank account rather than profiting from it, which is why, if you are charged an excessive fee, you should be able to claim that back from the bank.
Can I ask for charges to be refunded?
It's unlawful for the bank to profit from any penalty charges that go into your account. You can claim back any charges from bounced direct debits, from cancelled standing orders or bounced cheques that the bank has profited from.
