Don't overpay on your current account fees. Follow these simples steps and you'll have no nasty surprises when your quarterly statement arrives.
Although truly fee-free banking has been consigned to the past, there are still steps you can take to keep your fees to a minimum, or in a few cases avoid them altogether provided you're able to meet certain criteria.
1. Avoid ATMs when you can
ATM withdrawal fees are some of the highest being charged by banks these days. And there's more: in the 2016 Budget, the Government introduced a 12 cent stamp duty on every ATM withdrawal, capped at €5 a year.
This means that you’ll be charged 12 cent on top of what your bank charges every time you use an ATM (up to that €5 limit of course).
Taking out cash is sometimes unavoidable, so instead of going to an ATM, get cashback on purchases to avoid withdrawal fees.
2. Use contactless where possible
It's usually far cheaper to pay by contactless, at least for now, with Ulster Bank charging just 1 cent and all the other lenders charging nothing.
So tap and go wherever you can!
And remember that mobile payments like Google Pay and Apple Pay are charged as contactless transactions by all the banks. What's more, the €50 contactless limit doesn't apply to mobile payments, meaning you can pay for something over €50 by using your phone if you want - however some retailers using older terminals might still impose a €50 limit.
AIB, KBC, N26 and Revolut all offer Apple Pay and Google Pay while KBC, Revolut and AIB offer Fitbit Pay too.
3. Do as much of your banking online as possible
It’s usually quicker, easier and cheaper to do it yourself online.
For example an online transaction or self-service lodgement will cost you 20 cent with AIB and Ulster Bank. However an in-branch or staff-assisted transaction will cost you 39 cent with AIB and a whopping 80 cent with Ulster Bank.
4. Avoid cheques
Does anyone even use cheques anymore? If so avoid them - they’re an expensive and outdated method of payment and you'll also be hit with Government stamp duty of 50 cent per cheque.
Set up a direct debit/standing order or use your online banking to transfer money instead.
5. Look at the non-traditional digital banks like N26 and Revolut
We're big fans of N26 and Revolut here at bonkers.ie.
With both of these online-only banks all mobile, contactless, and chip and pin transactions are free and there's no account maintenance fees either. They both have a brilliant mobile app, support Apple and Google Pay, and allow you to open a bank account online in just minutes through the app.
You also get three free ATM withdrawals a month with N26 and €200 with Revolut.
N26 now has over 5 million customers worldwide and operates on a European Passport (a banking licence granted by the German regulator and the ECB). They're covered by the German deposit guarantee scheme and are regulated by the Central Bank of Ireland for conduct of business rules. Meanwhile Revolut has over 1 million customers in Ireland.
When you've opened your account you'll get your IBAN and BIC immediately, meaning you can get paid into the account from Ireland and set up direct debits and standing orders just like any other Irish bank account.
What's more, N26 charges no foreign exchange fees on non-euro card payments, while with Revolut there's a generous €1,000 a month limit. So if you use your card in the UK or the States you won’t be charged the 1.5% – 3.0% transaction fee that you’d be charged with most other banks.
If you’re withdrawing cash abroad, N26 will charge you a 1.7% fee while Revolut allows you withdraw the equivalent of €200 a month at no charge, after which a 2% fee is added. Both these fees are way more competitive than the 3-4% fee you’d be charged with the traditional Irish banks.
6. Know the rules around your bank's exemptions for fees and charges
Most of the banks still offer ways to avoid, or at least reduce, some fees and charges - provided you meet their various (albeit onerous) rules.
How to avoid fees with AIB:
Use contactless over chip and pin and refrain from taking out cash.
Take out a mortgage with AIB and pay it back from your AIB current account.
How to avoid fees with KBC:
With KBC's standard current account you can avoid most fees if you maintain €2,000 in your account at all times - but you'll still have to pay the €6 quarterly maintenance fee.
With KBC's Extra current account you can avoid all day-to-day fees and charges such as ATM fees, direct debit fees and chip and pin fees if you lodge just €2,000 into your account every month. There's no minimum monthly balance required with this account.
How to avoid fees with Bank of Ireland:
The €6 monthly fee can't be avoided but it covers all day-to-day spending so you shouldn't go over in it most cases.
How to avoid fees with An Post:
- Take money out from an An Post office where you get one free withdrawal a week.
How to avoid fees with Ulster Bank:
You can avoid most day-to-day transaction fees with Ulster Bank if you keep €3,000 in your current account at all times. But you can't avoid the €2 monthly maintenance fee.
How to avoid fees with Permanent TSB
Permanent TSB is the only main bank that is doing something a little different when it comes to its current account fees. The bank charges a €6 monthly account fee for all your day-to-day transactions but will pay you back 10 cent every time you pay for something with your debit card either in a shop or online (either by chip and pin or contactless). The amount you can make back is capped at €5 a month. So if you make just under two transactions on average with your card each day, you can recoup most of your fees.
- If you pay certain bills by Direct Debit from your Explore account you'll receive cashback of up to 5% on those bills.
7. Treat your current account like a savings account
As we can see, some of the banks offer the option of waiving most fees if you keep a certain amount of money on deposit at all times.
Given that the interest rates on savings accounts are so low at the moment, it might be worth your while treating your current account like a savings account. You might not earn interest but you’ll save yourself a lot in transaction fees!
8. Avoid referral fees
If a direct debit, standing order or cheque is presented onto your account and you don't have sufficient funds, your bank will charge you a 'referral fee', which can be as high as €12.70 for each failed payment. Yikes! (The only exception to this is BOI whose €6 monthly fee includes this fee).
So not only are referral fees bad for your credit rating, they're bad for your wallet too. So avoid racking up these huge charges by making sure you've enough money in your account at all times.
9. Make the switch
You don't have to put up with your current bank's fees and charges. There are more options available than ever before for those looking for a better deal.
Use our handy current account comparison service to quickly compare the different account features and charges from all of Ireland’s account providers.
And if you decide to switch, read our article on all the things you need to know.