FREE BANKING NEVER DID EXIST.

The usually sensible organisation 'Which ?' has just announced that the concept of "free banking" is a myth. This announcement has come after 'Which ?' conducted a detailed investigation into the banking servces that are offerred to the public.

That the conclusion reached is a "statement of the bleedin' obvious" hardly needs to be stated. Anyone who has the temerity to go overdrawn knows full-well that there are charges attached to maintaining their accounts. Most banks try to encourage customers to opt for accounts that carry a wide range of wholly unnecessary extras, mostly insurance based, for which there are monthly charges, while those who choose to use a basic account find that there is no interest paid on their positive balances.

The modern world makes it almost impossible to exist without having a bank account. Salaries, pensions and benefits are no longer paid in cash and recipients must have bank accounts in order to receive their income. Many companies impose financial penalties on customers who do not pay their bills by 'direct debit' and anyone without a functioning bank account will find it virtually impossible to obtain a loan of any sort.

While it may be that the ways in which our banks raise their vast profits are currently skewed against those who go overdrawn, opt for additional services and products or prefer not to use the direct debit system for payments, when interest rates return to more normal levels those who maintain a healthy positive balance will find that it is more likely to be they who are most disadvantaged. This latter group has no alternative but to accept the loss of interest, while the former has choices - should I go overdrawn ? Do I really want the additional products ? Why don't I use direct debit for paying my bills ?

By all means get the banks to identify the real costs of their services and even have them move towards more targeted charges, but implement this alongside proper recompense for those who maintain healthy balances and with a recognition that having a bank account is no longer an option but a necessity.