Co-op Bank announces 20% increase for current account fees
28 Apr 2014:
Banks risk customer backlash as it struggles to restore public faith following revelations of £1.5bn hole in its finances
Co-op Bank announces 20% increase for current account fees
Banks risk customer backlash as it struggles to restore public faith following revelations of £1.5bn hole in its finances.
The Co-operative Bank
announces a 20% fee increase for some current account holders.
Photograph: Christopher Furlong/Getty Images
The scandal-hit Co-operative Bank could face a fresh customer
exodus after announcing a near-20% hike in the monthly fees paid by many
holders of its packaged current accounts.
The move by the bank comes days after Co-operative Energy shocked customers by announcing it was putting up its electricity prices.
Holders of the Co-op Bank's Privilege Premier account currently pay £13 a month, or £156 a year, but from 1 July 2014 this will rise to £15.50 a month, or £186 a year. Privilege account holders will see what they pay each month rise from £9.50 to £11. Both accounts offer benefits including worldwide insurance and mobile phone cover.
Some customers of the Co-op Bank's internet arm, Smile,
will also pay more, with holders of its Smilemore account facing a
£2.50-per-month rise in their monthly fee, taking it from £13 to £15.50.
The increases are likely to leave some customers wondering if they are paying to put the bank on a better financial footing.
A bank spokesman said the increases, which affect an undisclosed number of people, "reflect the increase in costs of providing the features of the accounts to customers". He said there would be no changes to the benefits provided on the accounts.
The Co-op Bank has been attempting to restore the public's faith in its products and services after being engulfed by scandal following the discovery of a £1.5bn black hole in its finances. It previously admitted it was losing customers due to concerns over its future, but has been fighting back with a switching offer that allows new customers to earn £100 and make a £25 donation to charity.
It emerged recently that thousands of Co-operative Energy customers face an unexpected price hike after the group announced it was putting up its electricity prices by around £28 a year. That rise will take effect on 27 May.
The move by the bank comes days after Co-operative Energy shocked customers by announcing it was putting up its electricity prices.
Holders of the Co-op Bank's Privilege Premier account currently pay £13 a month, or £156 a year, but from 1 July 2014 this will rise to £15.50 a month, or £186 a year. Privilege account holders will see what they pay each month rise from £9.50 to £11. Both accounts offer benefits including worldwide insurance and mobile phone cover.
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The increases are likely to leave some customers wondering if they are paying to put the bank on a better financial footing.
A bank spokesman said the increases, which affect an undisclosed number of people, "reflect the increase in costs of providing the features of the accounts to customers". He said there would be no changes to the benefits provided on the accounts.
The Co-op Bank has been attempting to restore the public's faith in its products and services after being engulfed by scandal following the discovery of a £1.5bn black hole in its finances. It previously admitted it was losing customers due to concerns over its future, but has been fighting back with a switching offer that allows new customers to earn £100 and make a £25 donation to charity.
It emerged recently that thousands of Co-operative Energy customers face an unexpected price hike after the group announced it was putting up its electricity prices by around £28 a year. That rise will take effect on 27 May.
COPY http://www.theguardian.com
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