High street bank hikes charges for thousands from February 1 - £168 a year

Thousands of customers of a high street lender will see an increase of fees on their bank account. On Sunday, Virgin Money raised the price of its Club M packaged account, forcing loyal savers to pay more to keep their perks. The monthly fee for the Club M account jumped from £12.50 to £14, an annual increase of £18. This means customers will now have to pay £168 a year just to keep the account open.

Customers who sign up for the package pay a monthly fee in exchange for a bundle of insurance policies and perks. For example, customers receive worldwide family travel insurance that covers the account holder, their partner, and up to four dependants under the age of 18, including cover for winter sports, golf, and weddings. They also get worldwide gadget cover for mobiles, cameras, laptops and tablets for the whole family. Breakdown cover is also included.

Despite the price hike, packaged accounts like Club M can still be a money-saver for those who actually use the benefits, The Sun reported.

A Virgin Money spokesperson said: "This is the first increase since February 2021, and the new price reflects costs set by the third-party insurers for the benefits provided, such as travel insurance, mobile and gadget insurance and breakdown cover.

"Virgin Money does not earn any commission on the monthly fee, and we believe Club M remains one of the best-value packaged accounts on the market."

Virgin is not alone in offering premium current accounts to customers.

Nationwide's FlexPlus packaged account is priced at £18 per month and comes with a range of added benefits. These include worldwide travel insurance, mobile phone cover, breakdown assistance, and access to preferential loan and overdraft rates.

Lloyds Bank also provides a premium option through its Club Lloyds Platinum account, which includes worldwide family travel insurance, AA breakdown cover, and mobile phone insurance.

The account costs £22.50 a month, in addition to a £5 Club Lloyds subscription fee.