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OFT: Customers not served by Current accounts |
| Written by Bernard Kayden | |
| Thursday, 17 July 2008 | |
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A recent study by the Office of Fair Trading revealed that the market in current accounts is not functioning as it should be.<br><br> London (Shakespearefinance) July 17, 2008: Recent study conducted by the OFT revealed that the current accounts' market is not working as per the expectations. Banks are able to make only an average £152 from each of their customers in lost interest and overdraft charges despite customers ending up paying more due to the 'opaque' charging information.A huge number of customers had no clue how much they are paying in bank charges, either before or after they were incurred. The complexity of current accounts is only making things worse with customers finding it hard to compare their current accounts with others. OFT chief executive John Fingleton said that the personal current accounts are gateways to ensure effective and result-oriented participation in the nation's economy. But the market is not performing or serving its customers as expected. As per the Office of Fair Trading, banks earn close to £8.3bn in revenues from personal current accounts, which include overdraft charges amounting to £2.6bn. The net credit interest income amounts to another £4.1bn, which is being passed to the banks instead to the customers. The study was a result of OFT's recent triumph in High Court on the issue of unauthorised bank overdraft charges leading to a second hearing to conclude whether the charges are unfair and what will amount to a fair charge. Banks have appealed against the Court verdict and a second hearing will be made after this matter is settled. For additional information on the news that is the subject of this release (or for a sample, copy or demo), contact Webmaster or visit http://www.shakespearefinance.co.uk |
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