Why did Ulster Bank charge me to close my current account?

I closed two Ulster Bank current accounts recently and was told there would be no charge for this. One was exempt and one incurred a charge of €8.50. I thought Ulster Bank clarified that there would be no fee for closing accounts?

– Mr J.B.

There seems to be an awful lot of confusion surrounding the nuts and bolts of people moving their accounts as Ulster Bank and KBC wind down their business and leave the market.

It is the largest single exodus of customers within banking in the history of the State but, even then, some of what we are seeing is very disconcerting. Most critically, it seems that customers are having real problems getting straightforward answers to very simple questions, either from the banks they are leaving or those that they are trying to move their accounts to. And that is totally unacceptable.

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The governor of the Central Bank, no less, has made quite clear his disquiet at a significant undercurrent of frustration and delay in the process.

Adding to the concern is that, according to the bank lobby group the Banking and Payments Federation of Ireland, the banks themselves, bank staff unions and the Central Bank, the numbers actually moving accounts is just a fraction of what had been expected at this stage. Put simply, the banks have shown themselves unable to handle this switching of accounts even though the workload is far less than what had been predicted to date. The pressure is certain to rise over the next six months.

Either they have not hired or reallocated enough staff to customer-facing roles, they have not trained them sufficiently, or they do not have them available at the right time in the right place or channel. It is certainly the case that bank customers are finding it increasingly difficult to talk to actual people over recent years – either in person or by phone – as banks look to cut costs through increased automation.

I am not isolating Ulster Bank in this regard. In the experience of readers who have been in touch with this column over the past year, customers (or aspiring customers) are having pretty much the same issues with all the Irish banks – and no glossy television or print advertising can escape that reality.

The end result is a lot of frustrated customers, like yourself, who have taken the trouble to sort out their affairs in line with what they understand to be the agreed protocols, only to be left confused and, in this case, out of money as a result.

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You had two separate accounts and, upon inquiry, understood that there would be no charge for closing them. In the event, though one was closed without charges, the other one incurred a charge of €8.50. You don’t say but I am assuming this was deducted from the closing balance before the funds were either released to you or moved to a new account you set up elsewhere.

The first thing to say is that you’re correct in your understanding that the bank is not imposing any charges in relation to account closure during this winding down. A spokesman for that bank confirmed: “To be clear, Ulster Bank does not apply a fee or charge for closing or switching accounts.”

That’s clear enough, so how do you explain this €8.50 charge?

Most likely, the bank says, these are transaction fees that have accumulated since the last regular charging period for such fees.

Banks routinely send out communications to customers outlining account fees in the last quarter, half year or year. You will likely have incurred some of these transaction fees on things such as ATM withdrawals, card payments, cheques etc since then.

“Without being able to see the closing statement and knowing when the customer’s account was closed, it’s difficult to see what exactly the fees here are,” the bank spokesman said, “but it is likely they are other fees like transaction fees or arranged overdraft interest which the customer may have incurred up to the point of closure.”

He did also note that, since August, Ulster Bank had waived some personal and business banking fees and charges, such as the monthly maintenance fee, charges for exceeding an overdraft and also for payments returned – such as a cheque or direct debt – because of sufficient funds available.

I assume if you only incurred charges on the one account and not the other that the charge-free account is not actively used.

The explanation sounds reasonable, so what’s the problem with the bank here?

Twofold, really. First, this is a remarkably straightforward query and the fact that a reader would contact us suggests either they were getting nowhere with their own bank’s normal customer channels in getting a simple answer, or they were so fed up with the tortuous process of switching accounts that they didn’t even bother trying.

Either is an indictment of a bank to whom a customer entrusts the management of their personal finances.

In any case, I would have expected that, as a standard, banks would issue updated statements of fees and charges to customers as they closed their account. It may be that such a statement will be sent to you in line with the bank’s usual cycle of communication, but that really is not good enough.

In fairness, they did offer to get in touch with you to talk you through what exactly the charges may be if you want to give them some contact details. I’m not too sure you want to pursue that over an amount of €8.50 but that’s your choice. I can certainly pass your details on if you are happy for me to do so.

Please send your queries to Dominic Coyle, Q&A, The Irish Times, 24-28 Tara Street, Dublin 2, or by email to dominic.coyle@irishtimes.com. This column is a reader service and is not intended to replace professional advice