Invidious and greedy overdraft charges imposed by our banks are to be severely cut after investigation by the Financial Conduct Authority (FCI), the City watchdog.
One example of the scale of the rip-offs is treatment meted out by Natwest to customers who go £15 in the red where no overdraft has been agreed. These unfortunates are then charged £8 per day up to £72 per month, a figure way in excess of the actual debt. In some cases the daily fees represent an interest charge of 20% per day, far higher than the 0.8% a day cap the FCI imposed on payday lenders in a clean-up three years ago.
Rulings on essential changes to bank’s behaviour needed are expected to be made by the FCI by June this year.