'Big four' banks fail customers

Savvy consumers shop around

The major high street banks are offering poor deals to current account customers, according to a Consumers' Association survey.

Overdraft charges, interest paid to current account customers and consumer satisfaction were measured as part of the survey.

The big four banks - Barclays, NatWest, HSBC and Lloyds TSB - performed the worst, said the association.

At the other end of the scale, internet banks Cahoot and Smile did well, as did the Nationwide Building Society, the UK's biggest mutual.

The Consumers' Association said that the results of the survey prove that current account customers should shop around and break the monopoly of the big four banks.

Overall, the survey found that the big four only offer the vast majority of current account customers 0.1% interest and overdraft rates that are up to twice as high as the best on the market.

BEST FOUR BANKS

Smile

First Direct

Nationwide

Cahoot

Source: Consumers' Association

What is more, all the big four were ranked at the bottom of the pile when it came to providing customer satisfaction, while internet and telephone banking operations led the way.

Among the traditional high street based current account providers, Nationwide was seen as the best.

Consumer savvy

According to the Consumers' Association, in total savvy UK consumers could save £500m a year in charges and lost interest by moving their accounts to market leaders.

However relatively few consumers are heeding the shop-around message, despite a new banking code introduced in April making it easier for consumers to switch current account providers.

BOTTOM FOUR BANKS

HSBC

Barclays

Lloyds

NatWest

Source: Consumers' Association

The survey found that 95% of customers who had switched found the process easy.

"There's never been a better time to switch banks. The smaller rivals of the Big Four have again showed that they can offer excellent service and great rates," said Ashleye Sharpe, head of money research at the Consumers' Association.