Halifax in row over charges to poorest customers

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THE HALIFAX yesterday sparked a fresh row over excessive bank charges after it revealed plans to levy a new pounds 10 charge on nearly two million of its poorest customers.

The move by the Halifax to charge for so-called "third party" cheques is an embarrassment for the Treasury. It comes as ministers prepare to announce a major new initiative to make banks and building societies more receptive to the needs of those low-income people who do not have bank accounts. The charge will come into force on 1 February next year.

Halifax has written to 1.7 million holders of its card-based Cardcash account informing them that from next year they face charges if they want a cheque drawn on their account but made out to someone else.

The service is particularly valued by those who do not have the regular income needed to support a full-service bank account but occasionally need to write cheques. The move, which sparked an immediate hostile reaction from Halifax customers, comes just days after the Co-op and Barclays banks traded blows over the latter's plans to charge rival banks' customers pounds 1 every time they use its cash machines.

The latest attempt by a major high street bank to impose unpopular charges looks likely to set off yet more "rip-off Britain" complaints against the banks who are fast succeeding the supermarkets as the main target of public anger.

The banks are already being investigated by a committee set up by Gordon Brown, the Chancellor, who believes that Britain is being ill-served by the behaviour of most of the high street banks.

In spite of the clear hostility of their customers to further charges, the big banks seem determined to try and force customers to pay more for basic banking services, even though they have notched up record profits.