Irish current accounts and mortgage charges are cheaper than the European average, according to a report commissioned by The Irish Bankers Federation (IBF).
The banks intend to use the findings in their submission to the Competition Authority to dismiss suggestions that Irish consumers are being overcharged. The authority is due to complete an investigation into the industry later this year.
The results of the comparative survey of European bank charges, undertaken by consultants, Customers For Life, suggest the cost of operating a current account and a mortgage from an Irish bank was below the European average. It also states that the cost of a personal loan and a credit card is close to the European average.
The survey suggests that the cost of operating a current account in Ireland is 22.5 per cent below the European average, making it the fourth cheapest in the eight participating countries.
It calculated that the average cost of current account services such as ATM withdrawals, direct debits and cheques in the UK, Spain, Denmark, Ireland, Austria, Sweden, Portugal and Germany was €90 a year. The average cost to Irish customers was calculated at €69 compared with €61 in the UK and €161 in Germany.
The consultants conceded, however, that it was unlikely that customers in Germany would end up paying €161 a year for operating their current accounts because items such as cheques are rarely used by personal customers and the mix of services demanded would be different.
The €61 charged on average in the UK is a much closer measure in terms of gauging value for money because of the similarities in the type of service used by customers.
The survey does not factor in the fact that some current account customers could earn interest on funds held in the account, as is common in the UK, and which would further depress the overall cost of operating these accounts.
The IBF refused to give details of the cost comparisons of items such as direct debits and credit transfers in the various European countries on which the calculations were based.
In terms of personal loans, the average annual repayment on a €7,000 loan over three years was calculated at €2,695 with half of the countries included in the calculation outside of the euro zone.
The survey shows Irish customers' repayments were fractionally higher at €2,702. This compares with €2,171 in Belgium, €2,756 in Greece and €2,848 in Portugal where the loan rates are based on the ECB rate.
The consultants also looked at the cost of credit cards comparing the average annual charge plus interest paid by bank customers. The average was established at €191 but is again misleading because of the difference in the charges structure at various banks. In Ireland it estimates that customers pay more than the average at €193 annually against €254 in Spain.
For mortgages, where there is intense competition in the Irish market, the report finds that consumers here are paying up to 6.4 per cent below the European average.
By calculating the average annual repayments on a €120,000 mortgage over 20 years, it calculates a European average figure of €10,558 with Irish consumers paying €9,883. In Spain, where mortgages are also priced off the ECB rate, consumers were paying even less at €9,204.
