Free consumer banking could soon be a thing of the past in Britain, according to research by Datamonitor. Customers could face being charged to use cash machines and write cheques, which are currently free services.

Banks could begin charging customers monthly fees of between £5 and £20 for holding a current account, the research company believes.

The system would work in a similar way to consumer banking in the US, where a set monthly fee guarantees a fixed level of service, including cash machine withdrawals, direct debit payments and cheques.

The banks are under pressure over what they charge customers. The Office of Fair Trading (OFT) is still investigating ‘unfair’ banking charges, and is calling for banks to abolish penalty charges on customers who breach their overdraft limit or write cheques which bounce.

If the OFT wins its case, millions of bank customers will have the right to reclaim refunds dating back up to six years, which could come to billions of  pounds. That would put the banks’ finances under strain, and could lead them to introduce monthly charges, Datamonitor said.

“A charge per transaction for standard banking services could be one of the answers, as the banks will need to find other ways to reclaim the estimated £2.6bn they receive from overdraft fees and charges. In the current difficult market this is revenue that the banks can ill-afford to lose,” Datamonitor’s Rod Logan told the Daily Mail.

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