As a way to help people avoid large overdraft penalty charges,
Virgin Money is to charge a monthly fee for its
current accounts.
The firm is launching a new bank chain next year and says its
current accounts will be more transparent than many alternatives. The monthly fee will be upfront and no hidden extra charges will be payable when customers slip into overdrafts that are unauthorised.
Most high street banks charge around £35 when customers slip over their limit, but offer the accounts for free. Although many would prefer it this way as they do not go over their limits, for anyone who does find themselves reaching their overdraft limit on a regular basis, the
Virgin Money bank account might be a good option.
Jayne-Anne Gadhia, the chief of
Virgin Money explained, “most people know there is no such thing as free banking. Banks have to cover the cost of free
current accounts with hidden charges such as overdraft fees. We're definitely planning to charge for
current accounts and be transparent about it."
This news follows findings that millions of account holders in the UK are permanently in their overdrafts.
