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Confusing Overdraft Charges

Written By On 17/01/2014

Since the seven day current account switch service for banks and building societies was introduced 16th September, over a quarter of a million customers have decided to change.

Those are the statistics according to the Payments Council, who were responsible for organising the campaign. The body say that most British people are now much better informed about the service. They have registered a rise of seventeen per cent in customers that have moved accounts compared to the same time in the previous year.

But Which? report that two out of three that have switched did not find it so simple and encountered difficulties, whilst over one in four say that it took longer than the seven working days it was meant to.

The consumers' association also produced their results concerning bank's overdraft fees. They believe that most ordinary account holders would find it much too hard to decipher the ways in which banks display their unauthorised overdraft charges.

Their study consisted of eighteen astute educational candidates. They were required to find the answers to seventy two unauthorised overdraft questions using a variety of well known banks. Less than fifteen per cent of the answers that they produced were right.

One of them, a former headmaster, did not derive at any of the correct figures, whilst another, a senior tax inspector, only reached one result correctly out of his four tasks, Only one third of the group felt that an ordinary person would be able to comprehend it enough in order to bring up the correct result.

Now the consumer group want the government to step in to ensure banks are clearer and more transparent so that consumers can work out their overdrawn charges in an easier fashion.

Eric Leenders from the BBA disagrees and commented:

All the major banks make information about customers' current account use available to them in a downloadable format as required by the government's initiative to encourage transparency.