UK high street banks are still under pressure to reduce the fees they charge for unauthorised overdrafts, despite winning a Supreme Court case last year, but they continue to find other ways to keep the money flowing in. This recent article in the Independent highlights the ‘seesaw’ approach, with some controversial overdraft fees coming down, whilst other fees for regular use of accounts go up…

… the introduction of “more transparent” daily overdraft fees from Halifax last December and the new £5 monthly fees from Lloyds TSB from this December means that customers need to grab their calculators and double-check that their bank account is the most cost-effective for the way they manage their money over the month. For example, Alliance and Leicester charge 50p per day (up to a maximum of £5 per month); Halifax charge £1 every day a customer is overdrawn (£2 per day over £2,500); and now Lloyds TSB is going to add its two-penn’orth of confusion courtesy of an additional monthly fee on top of any interest already payable.

These are not unauthorised overdraft fees the newspaper is referring to, but charges for customers accessing an approved facility. As pressure has increased on fees for going over your agreed limit – sometimes as high as £20 per day - the banks have gradually nudged up the charges for approved overdraft use, giving them the ability to bring down some of the other fees.

Some of the fee structures being implemented are no doubt more transparent than they were, at first glance, but the motives driving these changes are anything but transparent.

Wonga provides a clear alternative for anyone considering going over their overdraft limit when in need of some emergency cash for a short period of time. We are a responsible lender and the cost will be fully displayed for you, before you apply.

This entry was posted on Monday, July 5th, 2010 at 11:16 am