The media has reported with some shock that Santander is increasing the cost of its 123 Current Account service. But that really is not the story. The truth is that low cost or free current accounts are not economically viable right across the board, and especially in this day and age of low interest rates.

The real shock is not that Santander has announced its price increase but that the rest of the banks have not yet immediately followed suit. Trust me. They will.

Santander has in many respects been incredibly brave in leading the way in “normalization” of current account charges, though to be fair, their £5 pcm charge is still only 50% of what Barclays has said is the £120 pa cost of provision of a current account. So either this is the first step in charging properly, or else it is an uncomfortable hybrid of increased headline charges with an ongoing commitment to other less transparent add-ons. One assumes the former with the EU’s Payment Systems Directive due in 2016 and the Competition Market Authority report due, er, now?

The smart banks will bite the bullet early. Their charging model has for years been opaque and adversarial. Santander is to be praised not eviscerated for having the sense and courage to take the first steps in the right direction.