According to a new report by the Competition and Markets Authority (CMA), banks could soon be pushed to charge the public a monthly fee of around £5 for their bank accounts.
The move would be a response to the level of transparency surrounding exactly ‘how’ banks make their profits and an effort to eliminate other fees.
According to figures bank accounts generate profit in the region of £8billion a year for banks in the form of overdrafts and foreign exchange rates. However, the specific amounts made from the individual customer is rarely disclosed to deter the public from avoiding the charges.
The report by the CMA suggests banks duck out of hidden fees on customer accounts, instead offering a flat fee on a monthly basis.
Head of online bank Atom, Mark Mullen said: ‘Banks make billions of pounds from current accounts but customers think they are getting the service free.
‘Transparency is unprofitable, because as soon as people know the charges they see how to avoid them.’
‘The CMA is likely to conclude that forcing banks to charge fixed monthly fees is unreasonable, but forcing them to be more transparent about how charges are shown is almost certain be an outcome.’
Adding that an eventual move to complete ‘paid-for-banking’ has a “certain inevitability.”