Sinead Ryan: Free alternatives to the mainstream banks
Free and online banking can offer alternatives to the mainstream lenders
DEPRESSING news from the Central Bank regarding our apathy when it comes to the enormous fees we are being fleeced with by banks, many of whom have been bailed out by Joe Taxpayer. Our reward? Extra charges and massive costs just to mind our own money.
The regulator found current account switching levels hit their lowest point in five years. Just 1,542 people upped sticks and moved down the road to another bank.
In fact, you’re more likely to change spouse than bank account.
The only good news was that 99pc of account switches were completed within the 10-day Switching
Code guidelines; hardly a big ask, given the low numbers.
More than €31bn is held in 5.3 million current accounts. Nothing gives consumers more power than numbers like that, and yet only a tiny fraction get annoyed enough to move provider each year.
The bank comparison site Bonkers.ie says: “The level of current account switching remains chronically low in Ireland and the figures are disappointing to see. Irish people continue to show huge loyalty towards their banks, despite everything that’s happened over the past few years.
“Consumers should remember that they could save up to €150 a year by switching current accounts in some cases. And while it may not seem like a huge amount, it’s better that the money is in your own pocket as opposed to the bank’s”. So, where do you start?
The first secret the banks never tell you is that entirely fee-free banking is possible, and no, you don’t have to keep thousands of euro in your account to get it. While they laud over-65s and student freebies, under EU law, banks must provide a basic current account at no cost to all customers. Surprised? Don’t be – not a cent of any bank’s marketing budget is troubled by advertising it, but they exist.
Basic accounts are just that though: you probably won’t get an overdraft or fancy app.
Some don’t allow contactless payments (although KBC, Bank of Ireland and PTSB do), or may limit the amount lodged (Ulster Bank only allows minimum wages to be lodged), but basic accounts offer a straightforward option for people with simple banking needs. See ccpc.ie under ‘financial comparisons’ and ‘basic bank accounts’. E-banking
Online banks like Revolut and N26 are hoovering up Irish customers. Under-30s in particular have taken to them, and love Revolut because (I am reliably informed by my younger correspondents) of the ease of moving money, sharing/splitting with friends (e.g. late-night taxis), and the very cool debit card issued.
They’re not free, but offer some free services if you don’t use them too much.
Retail banking
And so, to the mainstream banks. The good news is that most have great add-on services. AIB’s and KBC’s apps are truly excellent with super budgeting services (showing breakdown of spending really helps). Ulster Bank has introduced a savings goal feature, allowing you to name your savings and build towards them by diverting money there. PTSB’s Explore account (despite recently doubling its fees) gives the chance to ‘earn’ money when you spend in partner shops, up to €5 p.m., as does An Post through its smartaccount.ie product.
But they all charge. Some a quarterly account maintenance fee (see panel), and/or transaction fees for individual things like ATM access, lodgements, or even doing the bank’s work for them and moving your own money about.