This article is from the source 'bbc' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.
You can find the current article at its original source at http://www.bbc.co.uk/news/business-26973751
The article has changed 3 times. There is an RSS feed of changes available.
| Version 0 | Version 1 |
|---|---|
| Overdrafts complex and poor value, says FCA | Overdrafts complex and poor value, says FCA |
| (35 minutes later) | |
| Many overdrafts are "complex and opaque", carry high charges, and are not good value for money, a regulator has concluded. | Many overdrafts are "complex and opaque", carry high charges, and are not good value for money, a regulator has concluded. |
| The Financial Conduct Authority (FCA) said that "even the most astute consumer could struggle to understand what they are paying for" with an unarranged overdraft. | The Financial Conduct Authority (FCA) said that "even the most astute consumer could struggle to understand what they are paying for" with an unarranged overdraft. |
| An estimated £8bn is owed to banks and building societies through overdrafts. | An estimated £8bn is owed to banks and building societies through overdrafts. |
| The FCA will investigate the market over the summer. | |
| Court battle | Court battle |
| The regulator studied overdrafts that come as part of a current account, as well as unarranged overdrafts, where banks and building societies allow customers to go beyond their overdraft limit. | The regulator studied overdrafts that come as part of a current account, as well as unarranged overdrafts, where banks and building societies allow customers to go beyond their overdraft limit. |
| It found that many people were confused about the costs and that overdrafts were not providing good value. | It found that many people were confused about the costs and that overdrafts were not providing good value. |
| "Just about everybody who banks can have access to some sort of overdraft facility - whether they have signed up for it or not," said Christopher Woolard, director of policy at the FCA. | "Just about everybody who banks can have access to some sort of overdraft facility - whether they have signed up for it or not," said Christopher Woolard, director of policy at the FCA. |
| "The sheer size of this market is huge and with overdrafts bolted on to over 30 million UK current accounts, we want to make sure it is working well for consumers." | "The sheer size of this market is huge and with overdrafts bolted on to over 30 million UK current accounts, we want to make sure it is working well for consumers." |
| The regulator said that people failed to switch banks on the basis of overdrafts, so there was little pressure on banks to ensure these products offered good value. | The regulator said that people failed to switch banks on the basis of overdrafts, so there was little pressure on banks to ensure these products offered good value. |
| It also said that it was too simplistic for banks to claim that overdrafts subsidise the fact that there is no specific charge to open a bank account. | It also said that it was too simplistic for banks to claim that overdrafts subsidise the fact that there is no specific charge to open a bank account. |
| Overdraft charges were the subject of a major court battle four years ago. | Overdraft charges were the subject of a major court battle four years ago. |
| Banks defeated the Office of Fair Trading's attempt to regulate bank charges following the long-running legal case, but many have since made changes to their charging structures. | Banks defeated the Office of Fair Trading's attempt to regulate bank charges following the long-running legal case, but many have since made changes to their charging structures. |
| They also had to process millions of complaints about charges, with payments made to many thousands of customers. | They also had to process millions of complaints about charges, with payments made to many thousands of customers. |