Banks Look Set To Increase Overdraft Charges
The Daily Telegraph has been doing some research, and it has become apparent that certain financial institutions in Britain look set to increase overdraft charges to a massive £63 pounds.
Those that have been campaigning about it all, have claimed that the banks are complicating fee structures in order to mask the fact that charges are being increased.
It seems strange that this should become the scenario, as there is still an ongoing test case, over the unfairness of bank charges.
It is very much a case of the range of fees that banks are introducing, clouding the whole situation, while the Office of Fair trading are attempting to simplify it, and add a degree of transparency to the whole bank charges conundrum.
It may appear that the banks are using jargon and bureaucracy in order to confuse customers into just shoving up with exorbitant charges.
Indeed if there is this substantial increase then it would suggest that all this test case palaver has been somewhat futile; the banks are still going to do exactly what they want.
It all boils down to the banks being snide with the manner in which they elucidate charges to customers, in order to maximise profits. Machiavellian to say slightly less than the least.
All this research has been compiled by Moneysupermarket, on behalf of The Daily Telegraph, and there have been some interesting findings. For instance, customers of Abbey are paying £10 pounds more for going overdrawn than they were a year ago. There has also been an increase with Halifax, who a year on are charging their customers £5 pounds more on average, and are charging customers anything up to £63 pounds for exceeding their overdraft limits.
It is not all doom and gloom though, as the research found that customers of Barclays and Lloyds TSB are benefiting from charge decreases, in reference to specific accounts.
It is the general consensus among the banking industry, that charges provide the funding for free banking. Therefore, the punishment of those that fail to keep their house in order, is what benefits those that do. This is arguably a somewhat flawed model though, as it essentially punishes those that are least capable, financially. Essentially it is a case of robbing from the poor to give to the rich.
The approach from Abbey is refreshing one, in terms of transparency. An approach whereby the punishment fits the bill. If you go massively overdrawn, then you can expect to have a large charge. If it’s only a slight amount, then the charge is going to be smaller. Simple logic therefore, can be applied to the banking system, and suit everyone.