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Halifax imposes pounds 1 `disloyalty' charge

Isabel Berwick
Friday 27 August 1999 23:02 BST
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HALIFAX is to charge customers a pounds 1 "disloyalty fee" when they withdraw cash from other banks' cash machines.

From 1 November, Halifax current account and Cardcash customers will have to pay pounds 1 every time they use a machine that is outside the Halifax or HSBC networks.

A spokeswoman for Halifax said: "We are charged for when customers use other Link network machines and we have to pay a fee to the host bank. We are recouping that fee."

This latest round of tit-for-tat charging was sparked by Barclays' announcement last month that from 1 October it will charge non-Barclays customers a flat pounds 1 fee for using its machines. A sign will warn users that they will be charged pounds 1, and allow them to cancel the transaction.

This is common practice in the United States where many banks charge non-customers $1 per withdrawal from ATMs, but it is a first for the UK.

It will mean users could be charged up to pounds 2.50 for a pounds 10 withdrawal. An Abbey National customer using a Barclays machine, for example, would be charged a pounds 1.50 disloyalty fee by Abbey on top of the pounds 1 fee charged by Barclays.

Co-operative Bank and Royal Bank of Scotland do not charge disloyalty fees.

Simon Williams, the head of corporate affairs at Co-operative Bank, said: "The move by the big banks to introduce charges for cash machine withdrawals signals the end of universal free banking."

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