Newspaper article The Journal (Newcastle, England)

Call to Account Your Current Deal; IS IT TIME TO GET A "DIVORCE" FROM YOUR BANK? VICKY SHAW REPORTS

Newspaper article The Journal (Newcastle, England)

Call to Account Your Current Deal; IS IT TIME TO GET A "DIVORCE" FROM YOUR BANK? VICKY SHAW REPORTS

Article excerpt

CURRENT accounts have been put under the microscope once again, with the competition watchdog unveiling proposals that could help customers see more easily if they might be better off elsewhere.

At the moment, it's too easy for banks to sit back and take existing customers for granted, according to the Competition and Markets Authority (CMA).

The watchdog has put forward a string of proposals which it hopes will shake the situation up - and which it says could bring benefits to bank customers to the tune of PS1 billion over five years.

| What are the problems with current accounts? ONE major issue is our reluctance to switch deals. It is sometimes said that people stay "married" to their current account provider for longer than they stay wed to their spouse.

More than half (57%) of consumers had been with their account provider for more than 10 years and 37% for more than 20 years.

Current accounts have no particular "use by" date, so many of us stick with the same provider year in, year out, without considering if we might be better off elsewhere.

By contrast, with a financial product like car insurance, for example, many people will shop around when their annual policy is about to end, to see if they could get a better deal.

The array of mind-boggling charges that can come with current accounts can cause further confusion and put people off switching.

Yet the CMA found that many of us could be much better off if we made the leap to a new provider.

The annual savings could be on average PS116 - ranging from PS89 for customers who do not use an overdraft, to PS153 on average for overdraft users. In 2013, a new current account switching service was introduced, which has cut the length of time it takes to switch deals and taken much of the hassle out of switching - so it may not be as hard as you think.

| What is the CMA proposing to do? A FINAL report will be released later this summer, but the remedies CMA has provisionally put forward include a cap on monthly unarranged overdraft charges.

Other suggestions include improving the current account switching service and making more of advances in technology to help customers see the best deals for their personal needs. …

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