NI banks massively overcharging customers, claims watchdog

Bank customers in Northern Ireland are charged over 21 times more than their mainland counterparts, according to a report published today.

In the report by leading consumer watchdog, Which?, the big four banks in Northern Ireland; Bank of Ireland, First Trust, Northern Bank and Ulster Bank are accused of overcharging customers for virtually every service they offer.

Which? said it had presented its third “super-complaint” to the Office of Fair Trading (OFT) as a result of its findings, which come amid mounting concerns over the lack of any real competition in the local retail banking market.

Whether it is paying “paltry” interest for accounts in credit (generally 0.1%) to charging up to 43 pence each time a customer uses a cash point, sometimes even when they are not overdrawn, Which? said Northern Ireland customers are paying too much.

The difference is even more stark when it comes to overdrafts. A customer with a £500 authorised overdraft for two weeks each month could pay £11 per year with a Which? Best Buy account. But with a current account from one of the big four Northern Irish banks they could pay up to £236 a year.

Phil Evans, principal policy advisor, Which? said: “Bank customers in Northern Ireland are being ripped off. In addition, the big four in Northern Ireland are all offering similarly inferior products leaving their customers with little choice; indeed a choice between who will rip them off the least.

“We hope this work and that of the OFT will fundamentally change the market. In the meantime, however, we encourage people to shop around and we are working with the GCC on their forthcoming campaign to give consumers all the information they need to make switching bank accounts easy.”

Steve Costello, Chairman, General Consumer Council (GCC) added: “In our judgement, the market here plainly does not work for consumers. The banks must do the honourable thing by putting their house in order and removing these excessive and unfair charges. The OFT has the duty to investigate this in detail and answer questions about this market's effectiveness once and for all.”

Which?, working with the GCC for Northern Ireland, said it was making clear in its message to the Office of Fair Trading that the local banking market simply did not function in the interests of the people it is intended to serve.

(MB/SP)