Banks working for customers? That's a first
Banks have agreed to make it easier for customers to switch current accounts and to make it clearer what their charges are.
Under the changes, proposed by the Office of Fair Trading (OFT), banks must provide monthly reports and an annual summary of the actual account charges - this will enable consumers to compare the prices and benefits of other bank accounts and make it easier to switch accounts for a better deal, a bit like car insurance.
Although the proposed changes on switching direct debits are soon to be made easier are welcome, what is concerning is that we will all have to wait for up to two years for the changes to be introduced.
I am also concerned that the issue regarding unauthorised overdraft charges has still also not been settled - this is because the legal battle between the banks and the OFT continues, with banks appealing earlier Court decisions to allow the OFT to decide whether charges are fair or not.
Bank charges need to be made clear. One hopes this will be clarified once the House of Lords (which is currently considering the issue) announces its decision.
If we’d had this proposal some 15 years ago then many customers would not have fallen to the trap of hidden and obscene charges for going overdrawn.
These latest proposals are a move in the right direction but it is annoying that it has taken this long for the banks to do something positive.
It's common sense that a good working business needs to demonstrate transparency and be up front with costs - which begs the question: "why have banks been allowed to get away with this deception for so long?"
Consumers have had enough of underhand and devious methods, especially where banks are involved. These new measures should help people plan their finances and give them the opportunity to walk away from a bank that is not open and up front.
The new changes will also mean that banks will have to work harder to keep a customer – “that’s a first”, I say with a wry smile.
Mike Thomas is the Moneywise Debtwizard