IF YOU are one of the seven million or so UK adults who pay a monthly fee for their current account in exchange for a range of so-called benefits you could be wasting your money.

Following a review of packaged accounts, industry regulator the Financial Conduct Authority (FCA) has concluded that providers are not doing enough to ensure these products aren’t mis-sold.

The FCA says that, despite the introduction in 2013 of rules designed to help customers understand if these accounts are right for them, sales procedures and complaints handling need to be improved.

This is borne out by the number of holders contacting the Financial Ombudsman Service. After payment protection insurance, packaged accounts are the most complained-about product.

In the 12 months to March, the arbitration service received more than 44,000 complaints about them, ruling in favour of the customer in 14 per cent of the ones it took on.

And the proportion of justified cases is growing. In the three months to June, there were over 7,300 new complaints, with 23 per cent of those investigated going against the provider.

Jonathan Davidson, the FCA’s executive director of supervision, said: “We expect these products to be sold fairly and for customers to have the information they need to make an informed choice.

“And customers should not have to complain to the Ombudsman to get a fair outcome if things go wrong.”

There are more than 20 packaged accounts on the market, charging from £9 all the way up to £50 a month. They promise perks such as free travel and mobile phone insurance and car breakdown cover.

However, many customers fail to use these extras. Some forget about them or don’t realise what they are paying for, while others find that when they try to claim, they are not eligible because of their age or other exclusions.

To combat this, the 2013 rules state that before signing up new customers, providers must check they are eligible to claim under each policy – and let them know if they are not, so they understand exactly what they are paying for.

Providers must also send annual statements prompting customers to review their eligibility and whether the products continue to meet their needs. This is particularly important for travel policies, which generally have an upper age limit.

The FCA review found that while eligibility checks for travel cover had improved, firms had more work to do on mobile and gadget insurance and breakdown cover. It also concluded that more than a third of customers who complained to their provider about being mis-sold were poorly treated.

According to consumers’ organisation Which?, over an eight-month period last year Natwest, Barclays and Lloyds received the most complaints.

Meanwhile, the FCA regulations do not change the fact that for many people these products – particularly the more expensive ones – simply aren’t cost effective.

Which? money editor Harry Rose said: “We’ve looked at fee-charging bank accounts for many years and always find that some are much better value than others.

“Some of the benefits, such as travel insurance or breakdown cover, can come with restrictions which mean they just aren’t that much use.

“So if you are thinking of opening a fee-charging bank account, or already have one, ask yourself if you’re really getting value for money. If you’re not able to take advantage of the perks on offer, it’s not worth paying for them.”

Even if you do use them, there is little point paying for an account that offers ‘free’ protection if you could buy standalone policies at a fraction of the cost and your mobile phone is already covered under your home contents insurance.

Holders of all packaged accounts need to keep a close eye on what they are getting. Nearly one in five fee payers surveyed by Which? said perks had been removed since they opened their accounts and more than half said the monthly fee had increased.

If you still feel a packaged account is for you, Nationwide’s FlexPlus, which charges £10 a month, was awarded top marks by Which? for both its travel insurance and breakdown cover. In addition, it pays three per cent interest on credit balances of up to £2,500, potentially worth an extra £75 a year.

For many people who tend to stay in credit, a fee-free current account that pays monthly interest is likely to offer better value. Nationwide’s FlexDirect, which requires a minimum monthly deposit of £1,000 and two direct debits, pays five per cent interest on balances up to £2,500 for 12 months, later dropping to one per cent.

TSB’s Classic Plus, which requires a £500 monthly deposit, pays five per cent on up to £2,000, plus five per cent cashback on the first £100 of contactless purchases each month. Tesco Bank, which has no minimum requirement, gives three per cent interest on balances up to £3,000. There are also Clubcard points on debit card spending.

Meanwhile, Halifax Reward, which is currently offering a £100 incentive to switchers using the seven-day service, pays £5-a-month tax-free for those who deposit at least £750, use two direct debits and stay in credit.

Anyone who thinks they were mis-sold a packaged account, whether it is because the provider signed them up without their knowledge, told them it was compulsory to have one, did not explain the charges or misrepresented the benefits, should write to the provider stating their case and asking for a refund.

If the claim is rejected, or a satisfactory response has not been received within eight weeks, it should be taken to the Financial Ombudsman Service, which can be contacted on 0800 023 4567 or at Financial-ombudsman.org.uk.