For almost every bill we pay, from insurance to gas and electricity, we have the option of comparing multiple suppliers to find the best deal. Finding value is a huge drive for most people, with strides taken to make offerings as transparent as possible. One area where this isn’t applicable though is personal banking, where comparison of current accounts is almost impossible. Understanding charges and fees on accounts is something that people are struggling with across the country, and consumers are losing out because of it.
Those who benefit most from this lack of clarity, as ever, are the High Street banks who supply the accounts, who are anticipated to be making millions thanks to people feeling too confused to switch to a better offer. The banks’ profits are greatly improved and the consumer, inevitably, is left out of pocket.
The ambiguity surrounding current accounts means that the majority of people have little to no understanding of exactly what charges and interest they are actually incurring. This means that transferring the account elsewhere is effectively a gamble, as they have no means for comparison.
Research compiled by Tesco Bank has found that 55% of people are completely in the dark over what they get from their account in terms of both cost and return. Questions on overdraft fees, charges and credit interest were all included in the study, used as examples of how to distinguish between accounts. 14% believed that there were no ‘big’ difference between accounts, hence why they didn’t believe in switching.
Helping consumers to understand the true cost and value of the current accounts they hold is something that the Competition and Markets Authority are currently looking into. The aim is to ensure that excessive charges and a fair return are easy to achieve and the right choice can be made by every consumer who takes out an account.
The government have made commitments to increase the competition in banking too, to help create more cost effective options and better levels of service. There has already been introduced a 7-day current account switching service in 2013, something that saw 1.1 million people switch last year, a 4% rise on the previous year. The hunger is there from the consumer, and the means in place to move quickly too, all that remains is to find an easier way to establish what the benefit of moving would be.
If you think that you might have the wrong current account and are incurring charges that you shouldn’t, then speak to Enjay Claims today for advice on what you can do to find the right account for you. Call us on Freephone 0800 6127958.