A current account looks free until you read the fee schedule, the FX margin, the cash-machine rules and what happens when a payment bounces. “Digital” does not mean costless. It means the costs are often smaller, more frequent and easier to miss than a quoted annual fee.
Start by asking what you actually hold
A current account is a contract with a legal entity. You may also have a linked overdraft, a debit card, a savings pot inside the same app, and payment services run by other firms. Those are not one product. If the app is down, the question is which of those still works through a branch, phone line or another rail.
Read the name of the legal entity in the terms. Match it to the institution you think you joined. Clone sites and lookalike apps exist; the register of the national supervisor is the check, not the logo in the store.
The real cost stack
- Account fees: monthly charges, package fees, or fees that appear below a minimum balance.
- Payment fees: instant payments, international transfers, cheque handling, paper statements.
- Card fees: cash withdrawals, foreign transactions, replacement cards, ATM operator surcharges.
- Penalty fees: unarranged overdraft, returned direct debit, unpaid standing order.
- FX: the rate you receive versus a reference rate, plus any explicit conversion fee.
A more honest comparison
| Question | Basic current account | Packaged account | App-only account |
|---|---|---|---|
| Main cost | Often low or conditional | Monthly package fee | Usually low, costs sit in FX/ATM/extras |
| Access if the app fails | Branch/phone may exist | Depends on the bank | Often app-first; test a fallback |
| Overdraft | Arranged or none | Sometimes bundled | Varies; read the APR |
| Travel | FX and ATM rules matter | Insurance extras may be the pitch | FX margin is often the real price |
| Exit | Switching rules vary by country | Losing extras mid-year can waste the fee | Salary rerouting and direct debits need a plan |
Packages are not automatically worse. They are worse when you pay for extras you do not use, or when the insurance overlap with cover you already have is never checked. App-only accounts are not automatically better. They are better when the fee schedule matches how you actually pay, travel and withdraw cash.
Foreign spending is where “free” often ends
A card can have no annual fee and still charge a percentage on each non-domestic transaction. Dynamic currency conversion at a till or cash machine can be worse than the card’s own conversion. The cheapest-looking option on the screen is not a comparison; it is a prompt.
If you travel even twice a year, read: cash-machine fees, weekend FX markups if any, and whether a second card is needed as backup. One frozen card in another country is not a theoretical risk.
Instant payments, weekends and bounced bills
A payment that “usually arrives immediately” can still fail on a public holiday, after a name mismatch, or when fraud checks hold it. Standing orders that bounce can create both a missed bill and a bank fee. Build a one-day buffer in the bills account before the due date rather than aiming for a zero balance at midnight.
If you split bills with someone else, agree what happens when their transfer is late. Informal IOUs are how households create unarranged overdrafts.
Deposit protection is not a product feature
Eligible deposits may be protected up to a limit by a national scheme, with conditions. Protection does not cover overdrafts, investments, or “the app promised a bonus”. It also does not mean every brand name in an app is the same legal entity. If you keep large balances, spreading across separately licensed entities can be a practical question; spreading across two brands of the same bank may not be.
Read the scheme information from the official source in your country. Marketing summaries skip the eligibility detail.
How to compare without drowning in brochures
- List how you actually pay: salary in, rent out, number of cash withdrawals, travel days, international transfers.
- Price that usage against two fee schedules, including penalty fees you have triggered in the past year.
- Check access fallbacks: another card, a person who can help, a branch or phone line.
- Check switching: how direct debits move, how long salary rerouting takes, whether any paid extras reset.
- Only then look at “perks”.
If the comparison is for a joint household, include both people’s usage. An account that is cheap for one traveller can be expensive for the person who withdraws cash weekly.
Open banking and data access
Connecting another app to read your transactions can be convenient for budgeting. It is also a permission. Read who receives the data, for how long, and how to revoke it. Prefer regulated account-information services where that framework exists, and revoke access you no longer use.
A spreadsheet you export yourself is slower and keeps the data on your device. That can be enough.
What to keep on paper anyway
IBAN, BIC where used, the legal entity name, the emergency contact route, and a record of recurring payees. If you only store these in an app, a locked phone becomes a household problem. A paper copy in a safe place is dull and useful.
Red flags that deserve a pause
- A site that asks you to “confirm your account” after an unexpected message.
- A fee schedule that is missing, or only available after you start an application.
- Pressure to enable an overdraft in order to “finish setup”.
- Support that cannot name the legal entity or the deposit-guarantee scheme.
- Lookalike brand names that differ by one letter from a known bank.
When in doubt, type the supervisor’s register address yourself. Do not follow a link from the message that worried you.
Switching without cutting off salary
If you change accounts, move a low-risk incoming payment first, then bills, then salary. Keep the old account open until two full bill cycles have run on the new one. Screenshot confirmations. The boring sequence prevents a missed rent payment during the clever sequence.
Close unused overdrafts on the old account so a forgotten fee cannot appear later. Confirm that digital mandates actually moved, not only the ones you remembered.
A worked cost sketch
Imagine two accounts. One charges €4 a month and cheap cash withdrawals. The other charges €0 a month, 2% on foreign spend, and €2 per out-of-network cash withdrawal. A person who travels little and uses cash twice a year may prefer the zero monthly fee. A person who withdraws cash weekly may not. Neither answer is universal. The arithmetic only works after you insert your own counts.
Do the same sketch for bounced-payment fees if you have had even one in the last year. A “free” account with two returned direct debits can cost more than a packaged account you actually use.
Records worth keeping for a year
Fee schedules as they stood when you joined, notices of changes, and your own usage counts. Banks can change terms; your memory of the original deal will not win an argument without a file.
If a fee looks wrong, complain in writing to the institution first, then use the official dispute route in your country if needed. Educational sites cannot run that process for you.
Before you act
Turn the reading into a written decision rather than an immediate switch or purchase. Note the job of the money, the earliest date it may be needed, and which bill would actually hurt if it were late. Compare at least two reasonable alternatives, including doing nothing for now. Record fees, notice periods and how you would access the money on a working day.
Then verify every provider through primary documents. Match the legal entity to an official register, read the latest terms, and keep a copy of what you relied on. Do not trust a badge, app-store listing or authorisation number shown in an advert. If the decision affects tax, debt you cannot service, housing or a large share of household resources, consult an appropriately authorised professional who can consider the full circumstances.