Nationwide may jump on account fee bandwagon

In the latest movement on banks and building societies that are planning to turn free bank accounts into fee charging ones, it seems as though Nationwide may be gearing up to jump on board.

As the incoming Chief Executive has stated that there is nothing wrong with operating a fee charging account and that it could even be classed as a fairer model than free banking and high penalty charges. The current Finance Director of Nationwide, Graham Beale is set to take over as Chief Executive in April of this year.

Beale stated: 'It's not free to run a branch or an ATM, so what it means is that when you apply charges to delinquent accounts they bear the large proportion of that cost. In an ideal world those costs would be shared.'

Nationwide is one in a number of banks and building societies that have either changed over to fee charging bank accounts or have expressed interest or hinted at future moves to fee charging bank accounts for consumers.

First Direct, the Internet arm of HSBC, was the first to raise controversy over fee charging bank accounts last year, after anno0uncing that as of February 2007 certain customers that did not meet set criteria with regards to the First Direct products that they hold or the amount going into their accounts each month would be charged a ten pounds monthly fee.

More recently Citibank announced that it would be switching all of its current account holders to a new current account that charges ten pounds a month for certain benefits such as mobile phone cover, ID theft insurance, and holiday insurance.

However, Citibank customers can opt out of this by contacting the bank and being switched to another fee free current account instead.

Tom Smith
01.03.07

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