Switching banks is made easier

CHANGING your bank should theoretically become easier from now. A voluntary code of practice on freedom of movement between banks, being promoted by the European Union, came into force in all French banks in November.

According to the French Banking Federation every bank will have a form of service d'aide à la mobilité bancaire (banking mobility help service), though this exact wording may not be used by them all.

The main change is that if you want to swap to a new bank, when you open an account you can ask the bank to transfer all your regular incomings and outgoings from your old account by contacting the different bodies, so you do not have to do it. You will be asked to give your formal consent for the bank to act on your behalf.

Once the process is complete, you can then close your old bank account with all your payments continuing as normal with the new account.

Banks will offer the service to any private individual opening a deposit account who asks for it, providing written information about it and details of any charges which may be involved.

The aim is to make it easier for individuals to have choice. Only about 4% of people change banks in a given year and an Ifop survey showed a quarter had the same bank for more than 30 years.

The measures come as French banks were criticised by the European Commission for being among the worst for hidden fees and confusing charging structures.

A lack of transparency may discourage people from changing banks, said EU Consumer Protection Commissioner Meglena Kuneva, presenting a report on European banking fees.

The French Banking Federation said it was “astonished at the results of the inquiry and doubted its accuracy.”

The latest figures from state fraud body DGCCRF show complaints to banks rose 15% between the second half of 2008 and the first half of 2009.