A decision is expected today which will help to clarify the legality of bank charges and determine whether or not the banks are being fair to consumers in charging up to £39 for exceeding an overdraft limit, bouncing cheques, and having insufficient funds for direct debits and standing orders.
A high court judge will hand down his ruling today on whether or not the banks’ terms and conditions are fair under the Unfair Terms in Consumer Contracts Regulation (UTCCR) 1999.
Once this has been determined by law, if the Office of Fair Trading – which brought about the test case against seven of Britain’s largest banks and one building society – is successful, then it is expected to declare that bank charges are disproportionate to the crime and therefore unfair and unlawful, and state that they should be reduced significantly. It is estimated that the actual cost incurred by banks could be as low as £2.
In this instance, bank customers will be able to reclaim millions of pounds in the charges they have paid during the last six years. However, banks may try to recoup these losses, and the lost revenue of future charges, by slapping a charge on banking and punishing everyone, not just those who have incurred charges in the past.
If it goes the other way and the banks emerge victorious, then the OFT is likely to appeal which could mean the case continues on into next year.
they should hurry up its taking to long
By: tom robinson on May 9, 2009
at 5:49 am