BANKS AND building societies might be falling over themselves launching new savings and lump-sum deposit accounts and tweaking mortgage offers, but the current account market has been relatively subdued in comparison.
Postbank, the banking joint venture between An Post and Belgian bank Fortis, launched its current account on Monday and is hoping to recruit 25,000-30,000 customers this year. Its everyday account is pitched on its simplicity.
Customers do not pay fees on day-to-day transactions and can obtain a €250 overdraft by showing their most recent payslip and a one-month bank statement.
Postbank is offering the current account initially through 270 post offices but it will be extended to all 1,000 post offices in the State over the summer.
Postbank chief executive Margaret Sweeney said: "Consumers are becoming even more confused and probably a bit disenfranchised with the retail banks."
Bank products, including current accounts, had become more complex and Postbank wanted to make products easier to understand. "Our focus is on trying to make things a lot more straightforward and managing to fit people's lifestyles as well," Ms Sweeney said.
Postbank is following the likes of permanent tsb and Halifax, which also offer free day- to-day banking and which have managed to attract many current account customers from AIB and Bank of Ireland, which control the lion's share of the market.
Bank of Scotland (Ireland) has said that one in every four account switchers, using the Irish Banking Federation (IBF) switching code, opened accounts in a Halifax branch, its retail brand, last year.
Permanent tsb added 69,000 new current account customers in 2007, helped by its high-profile advertising campaigns, bringing its total to more than 500,000.
AIB and Bank of Ireland also offer free current account banking but only if customers carry out certain functions. For example, Bank of Ireland customers must make three payments through its online or phone service every three months, or maintain a minimum balance of €500 for a full quarter.
Despite new offers in the market, the competition for current accounts has been not as intense as the fight for mortgages, loans and savings in recent years.
IBF chief executive Pat Farrell told an Oireachtas committee that while the number of credit card providers increased from eight to 13 between 1995 and 2008 - and the number of personal loan providers rose from nine to 21 and mortgage lenders from nine to 14 - the number of banks offering current accounts fell from eight to seven in that time. This decline could be reversed, however.
Fergus Murphy, chief executive of Educational Building Society, said it was the EBS's "strong intention" to look at launching in the market.
