Virgin Money is
still working on its overall proposition and is considering
different account pricing structures, its chief executive
Jayne-Anne Gadhia told RBI.
Gadhia stuck by her comments earlier in the year that there is
no such thing as ‘free’ banking.
Go deeper with GlobalData
“‘Free’ banking, of course, is not free. ‘Free’ banking for good
customers is subsidised by ‘insufficient funds’ charges, which are
generally paid by customers who are less affluent or less
well-informed,” she said.
She said a “rational” pricing structure with
lower insufficient funds charges and appropriate fees for current
account services is fairer and would make it easier for customers
to compare their likely charges.
In March, Virgin said each account will cost
less than £5 ($7.7) per month – the first UK bank to charge a
compulsory monthly fee, regardless of how much customers deposit in
the account.
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By GlobalDataVirgin confirmed it is targeting a 70-branch
network over the next 5 years, which will be grown
organically.
But in a contradiction of terms, Gadhia said
Virgin is looking to grow its business “significantly” through
acquisitions to provide competition in UK
banking.
A final decision has not been made on the name
for the Virgin Money bank, due to launch in 2011 [link to ‘Virgin
Bank’ launch “on track” for 2011]. But it is likely to be
rebranded as Virgin Bank.
As well as current accounts the new bank will
offer savings products and mortgages to complement the existing
product range – credit cards, general insurance, ISAs, unit trusts
and pensions.
Virgin already offers a savings account to
around 2.5m customers in the UK.
