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Bank-account commission is facing €3-a-month limit

BANKS will be forced to cap current-account commission, or “admin charges”, to just €3 a month by 25th March.

This welcome move for customers has been introduced by the Spanish Government to ease their monthly burden.

Charges have varied, from €1.50 to over €12 a month, on each and every account, depending upon where you bank, which meant it was not worthwhile setting up separate ones for bills, holidays, car expenses, etc.

Even at €3 a month, banks will still net €36 per year, per account. But with the high-street finance industry being forced more and more to become competitive, offering customers good reasons to stay, some banks are opting to reduce, or even axe, commission altogether.

Unfortunately, many banks continue to demand a minimum, average balance of around €2,000-€3,000 a month to waive commission. Yet these sums are unlikely to be maintained by the ordinary wage-earner, though high enough that €36 annually in admin fees would not make much of a dent.

The difference now is that the €3-a-month maximum must cover credit and debit cards, which means charges for renewing those expired ones must be included.

And up to 120 annual withdrawal or payment operations, within the entire European Union and not just Spain, takes in direct debits, standing orders and transfers.

Once these 120 transactions, averaging 10 per month, have been exhausted, banks are still not permitted to increase commission, beyond their usual sums for these operations, to compensate for any losses by the €3 cap.

So, if a bank doesn’t normally charge for withdrawals, payments or standing orders, it will not be able to do so once 120 transactions in a year have been made.

Transferring money between accounts held at different banks will be amended by the new requirements, making them much easier, and, in most cases, free of charge.

Banks are also required to tell customers about the best deals they can offer on accounts and commissions, whether or not this information is requested.

The €3 cap will be reviewed every two years by the Bank of Spain, meaning it may go up, or even down, depending on various economic factors.

Once details of the new law are published on 25th March in the State Official Bulletin (BOE), they will go live within 20 days, and banks will be required to comply.

 

Short URL: http://www.canarianweekly.com/?p=46644

Posted by on Mar 15 2019. Filed under Local News. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.

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