This site uses cookies to improve your experience and to provide services and advertising. By continuing to browse, you agree to the use of cookies described in our Cookies Policy. You may change your settings at any time but this may impact on the functionality of the site. To learn more see our Cookies Policy.
OK
Dublin: 4 °C Wednesday 11 December, 2019
Advertisement

New AIB regime will mean transaction fees for thousands

A new regime taking effect in two months will mean customers with less than €2,500 in the bank will face transaction charges.

Image: Julien Behal/PA Wire

Updated, 11:46

AIB HAS CONFIRMED plans to scrap free banking for thousands of customers in two months time, by reintroducing transaction fees for customers whose account balances fall below a certain limit.

From the end of May, customers will need to have cash balances of at least €2,500 in their account for the entirety of a three-month window in order to benefit from the existing arrangements where transaction fees are not charged.

Previously, charges were waived for any account holder who made one payment per quarter through internet banking, and who used a debit card on at least one occasion.

Now, accounts will be subject to a quarterly maintenance fee of €4.50 per quarter, with a further charge of 20c for every electronic transaction and 30c for each staff-assisted or paper transaction.

The new rules mean that around 60 per cent of AIB’s personal current accounts will be liable for transaction charges – meaning some 900,000 accounts will now be liable for charges, though a significant number of these accounts are inactive and would already have faced charges.

The bank’s director of personal and business banking, Bernard Byrne, said the decision was a “difficult” one to make, but said it was necessary if the bank was to “create the conditions in which we can become a strong and viable entity again”.

He added that the free banking offers in place across the industry had “changed significantly in recent times”.

Accounts held by children, students and people over the age of 60 will retain their exemption from fees.

The move follows a similar switch from Bank of Ireland in late 2010, when it required customers to lodge €3,000 to their accounts every quarter, and maintain a minimum number of transactions, to retain their exemption from fees.

The country’s largest other bank, the RBS-owned Ulster Bank, retains free-fees banking for customers who remain in credit or within their agreed overdraft limit.

Dermot Jewell of the Consumers Association of Ireland criticised the charges, which he said were an incentive to drive people away from retail branches and onto the internet, where banks could offer the services more cheaply.

“It remains a difficulty that there is a group, though maybe a small one, who do not want or who arguably cannot access internet banking,” he said.

“The €2,500 limit is less than Bank of Ireland’s, and it’s to be acknowledged as such, but it’s still going to be too much for very many, and excludes them from the opportunity to avail of free banking.”

Read: AIB confirms plan to seek 2,500 voluntary redundancies

More: AIB still paying millions for staff gym and golf club fees

  • Share on Facebook
  • Email this article
  •  

About the author:

Gavan Reilly

Read next:

COMMENTS (151)