Will Permanent TSB really pay you to have a current account?

From today, Permanent TSB’s brand new Explore Account becomes the bank’s standard current account amidst talk that customers will actually make money by signing up.

So, will Permanent TSB really pay you to open a current account?

Well, that’s the million-quid question, isn’t it? Actually, it’s more like the forty-eight euro question...

You see, the bank is putting an end to fee-free banking for new customers and will be introducing a €4 monthly fee. So, every customer will be charged €48 a year.

However, there are ways to offset this fee, and to even make a profit with the Explore Account.

10c per debit card transaction

Permanent TSB will pay Explore Account customers 10 cent for every debit card purchase, including point of sale transactions and online shopping, up to a maximum of €5 a month.

So, you’ll have to make 40 debit card transactions in a month to offset the €4 monthly fee, but if you clock up 50 debit card uses or more, you’ll be €1 better off every month.

To cancel out the €4 monthly fee, you’ll need to use your debit card between one and two times a day, every day, which might not be too hard to people who pay for their morning coffee and lunchtime sandwich with their card, but for others it might be more difficult.

So, the key question becomes how often do you use your debit card? According to Permanent TSB’s Commercial Director, customers use their debit cards 17 times a month on average. At this rate, customers will be €2.30 short of breaking even at the end of the month, amounting to an annual account maintenance cost of around €27.60.

It’ll be important to not get so concerned with meeting the 40 transaction limit that you actually end up making purchases that you wouldn’t have made otherwise!

Cashback

The most interesting aspect of Permanent TSB’s Explore Account is its new cashback programme.

Customers can earn up to 5% cashback on certain bills that are paid by direct debit from the account. SSE Airtricity, Sky Ireland and Topaz are already signed up to the programme, and we’re told that more partner companies will be added in time.

So, if you get your broadband and TV from Sky, your gas and electricity from SSE Airtricity and you do a lot of driving, this account is for you!

It’ll be interesting to see which other utility suppliers join the programme next.

Existing customers

Permanent TSB’s Explore Account replaces the bank’s previous standard current account, which made it easier to avoid fees than any other bank. And the good news is that customers who are on the old account account can keep it. But for those that fancy a change, they have the option to switch over to the Explore Account if they like.

Complex current accounts

Every major bank has a different set of conditions that must be met in order to get fee-free banking, and what’s best for your neighbour might not be best for you.

So, it’s really important to get to grips with the different fee waivers on offer and to make sure you aren’t paying fees that you don’t have to. Here’s a quick run-down of each of the main bank’s fee waivers:

• AIB waives fees for customers who keep €2,500 on deposit at all times
• KBC requires customers to lodge €2,500 every month to avoid fees
• Ulster Bank will waive fees for customers who keep €3,000 on deposit at all times
• Bank of Ireland charges a €5 maintenance fee to all customers, but will waive transaction fees of a customer keeps €3,000 on deposit at all times

If you aren’t with the right bank for your spending and saving habits, you can switch now on our Compare Current Accounts page.