Now that the banks involved in the High Court test case, which tested whether or not bank charges can be tested for fairness, have lodged their appeal against the decision in favour of the Office of Fair Trading, customers are wondering what their next step is.
Unfortunately, bank customers who have paid up to £39 a time for exceeding unauthorised overdrafts and bouncing cheques will have to wait a bit longer to find out whether or not they can reclaim the charges.
Mr Justice Andrew Smith rules that the OFT could determine whether or not the bank charges were unfair, potentially opening the floodgates for thousands more claims from disgruntled customers who feel they are being punished for going overdrawn.
The charges, the OFT has said, are only supposed to represent the costs incurred by the bank when a customer goes outside the terms and conditions of their account, but because they are disproportionate, it is striving to see them reduced.
On May 22, the seven banks and one building society involved in the test case launched their appeal against the High Court decision, maintaining that the payments are fair and justifiable.
In the meantime, many customers are confused about what this means for them – when what it actually means is that they need to sit tight and wait it out. There has been a freeze on reclaiming the charges since the FSA said that no more charges should be reimbursed until the matter was clarified by law.
The appeal is expected to be heard in July, and there will be an OFT hearing from July 7-9 in order to determine whether the terms in the banks’ current account contracts are fair under the UTCCRs (Unfair Terms in Consumer Contracts Regulations).
However, consumer campaigner groups are advocating that customers should continue to send in their claims to the banks and county courts in order to put pressure on the issue and be higher up the list if the courts ultimately rule in favour of the consumer and everyone starts claiming back their charges.
