Fee-free transaction account a hit for Citibank

Citibank has enjoyed a 49 per cent increase in customer numbers for its transaction account, Citibank Plus, since last October.

The bank reported yesterday that it was signing up more than 5000 transaction account customers a month and passed 100,000 transaction banking customers in June.

Citi has around A$5 billion in household deposits and a market share of less than one per cent.

Last October the bank relaunched Citibank Plus, making it "totally fee-free" by removing all additional service fees, such as bank cheque and dishonour fees. It also made overseas ATM, point of sale transactions and funds transfers fee-free.

With the new account switching rules now in force, aimed at making it easier for customers to change providers, Citibank is hoping customer acquisition will accelerate.

Citibank claims to have more than one million customers in Australia but not many of them are "main financial institution" customers. The relaunch of Citibank Plus was aimed at changing that.