In response to First Direct's plans to charge some of its current account holders GBP10 per month, rival UK bank Halifax has announced that it is committed to free banking. The HBOS subsidiary has also announced the opening of three new branches.
Halifax’ declaration of its commitment to free banking comes on the back of news that HSBC unit First Direct is to begin charging current account customers who do not pay in a certain amount each month. First Direct’s announcement has sent shockwaves through the industry, with many claiming that the move heralds the end of free banking in the UK.
However, Peter Jackson, head of products at Halifax, has stated: Halifax is committed to free banking, and we would hope that other banks and building societies share this commitment.
He also pointed out that parent company HBOS regularly takes over 20% of the new to banking and switchers market. This figure could bode well for the company given that there are bound to be First Direct customers now looking to abandon ship and find themselves another bank.
Although Halifax has been keen to point out its plans to keep standard banking services free, Nationwide has hinted that it may not be able to make the same promise, in the long-run at least. The building society’s outgoing chief executive, Philip Williamson, is quoted by This is Money as stating: I don’t think we can rule out charging for current accounts totally although we have no immediate plans to introduce such charges at the moment.
In other news, Halifax has announced plans to open three new branches in the UK, at locations in Weybridge, Bloomsbury and Ealing.
The Weybridge branch will have 12 full-time staff and two ATMs, the Bloomsbury branch will have 16 full-time staff and two ATMs, and the Ealing branch will have 24 full-time staff and three ATMs.
The openings form part of Halifax’ plans to open 100 new branches across the South of England over the next five years.