Royal Bank of Scotland and NatWest has announced they will be cutting their unauthorised bank charges from October 1.
The bank charge cuts will mean the fee for returning a cheque, direct debit or standing order reduced from £38 to £5, while the charge for paying for an item on an unauthorised overdraft will be halved to £15 a day.
The move by RBS, who also control NatWest, comes despite a number of banks including RBS and NatWest, and the Office of Fair Trading awaiting an appeal decision by the House of Lords for the ongoing test case.
Pleased with the announcement, Brian Hartzer, CEO of the Group said: “This is good news for customers, not least because the fees for unarranged borrowing have been an area of ongoing concern for them.
“As we look ahead there are many issues to consider, but we thought it was time to move this particular customer concern forward by cutting our charges.”
According to Louise Bond, personal finance expert at uSwitch.com, this should encourage other lenders to do the same, she said: “As the first providers to step up to the plate and do the decent thing before the outcome of the test case, we eagerly await the other banks to follow suit.”
Peter Vicary Smith, chief executive of consumer group Which? has also welcomed the news, he said: “This is a step in the right direction and a victory for consumer pressure.”
However, he added if RBS and NatWest wanted to fully satisfy their customers, “they should admit defeat in the bank charges test case and repay the millions of pounds Which? believes they’ve been unfairly taking from their current account holders for years.”
