Hot on the heels of the news that Metro Bank has been granted a banking licence by the FSA, more news from another bank that is hoping to soon be appearing on the UK high-street.
This time, it’s Richard Branson’s banking-baby, Virgin Bank, who’ve announced that they will be charging customers a “low monthly fee” for its current accounts.
Their Chief Executive, Jayne-Anne Gadhia, told the BBC:
“We want to live up to Virgin’s ethos of making sure people aren’t ripped off, that they know what they’re paying for with no hidden charges and I think that’s really important.”
They’ve also stated that customers won’t have to pay a certain amount into their account each month, like many current accounts do.
It’s an interesting tactic, and is one that it likely to be watched with some interest from the other high-street banks. Although there have been some suggestions that the end of overdraft charges might mean us all paying for our accounts, no banks have yet taken the decision to switch to this strategy.
In some ways it is a safe bet for Virgin Bank – without an established customer base, it can try out charging for accounts without having to worry about a mass exodus of clients, as the other banks with millions of customers might fear.
Virgin Bank is likely to launch later in the year, and earned its own banking licence after purchasing a regional bank, Church House Trust, earlier this year.