French bank charged €1,000 for UK transfer fees

A reader wrote to warn of having paid his former French bank around €1,000 for receiving ‘non-SEPA’ transfers from his UK bank – and to praise his new French bank for not charging for this.

Ken Jones, 72, a retired sales manager, said the fees on the account he holds jointly with wife Kathy mounted up over a three-year period.

He said they led to months of disputes with his UK bank, Halifax, over whether the transfers were in fact being sent through the SEPA system, as he wished. 

He said investigations, including assistance from the Financial Ombudsman, indicated the transfers were not being sent via SEPA, though Lloyds Banking Group was unable to explain to us why this may have been on the basis of the information we provided. 

The group was also unable to clarify if there may be a difference after its Halifax brand changes over to Lloyds, which is under way.

Eventually, Mr Jones, from Finistère, Brittany, said the solution was to change French banks from Crédit Mutuel to Crédit Agricole in Huelgoat, which he said "has been faultless and clearly understands what customer service and care should look like".

SEPA vs SWIFT transfers

Post-Brexit, the UK remains in the EU’s SEPA payments zone, and if a UK bank converts pounds to euros and sends them through the SEPA system, French banks can treat them as if they were a French transfer (usually with no receiving fees).

However, not all UK bank transfers are sent this way (alternatives include SWIFT). Whether a transfer is classed as SEPA depends on how the sending bank processes it, not simply on the fact it originates in the UK.

Adding to confusion, certain French banks opt to charge substantial ‘international’ or ‘non-SEPA’ incoming transfer fees even when a UK bank sends money via SEPA, because they only treat transfers originating within the EEA as subject to the EU’s equal-charges rules. 

The Connexion previously discovered this to be a loophole that is possible as the UK is now outside the protection of the relevant EU banking regulation (this can also affect transfers from Switzerland).

Where this is the case, banks generally spell this out in their tariff guides.

The current Crédit Mutuel de Bretagne tariff guide lists a €14.75 fee for incoming non-SEPA transfers. Elsewhere, it also includes the UK among countries in the SEPA area.

With regard to the Halifax brand change, Lloyds Banking Group said its customers in France should expect very little to change in practice.

“Important points to share are that their account details will stay the same and, over time, we’ll update our branding.

“The only action some customers may need to take is, if they don’t already use it, to switch to the Lloyds app [and online banking] – we’ll let them know well in advance if and when they need to do that.

“We’ll contact customers through our usual trusted channels, including the Halifax app, online banking, email, and letter where appropriate.

“We’ll always explain clearly if they need to do anything.

“As always, we’ll never ask customers to move money or share their PIN, password, or security codes.”