Comment on RBS decreasing its overdraft fees

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Published:
08/09/2009
Topic:
Press Release,Current Accounts

Commenting on RBS decreasing its overdraft fees, Ian Williams, director of communications at moneysupermarket.com said:

"Although any reduction in fees is good news for consumers, RBS customers will still be subjected to high unauthorised overdraft fees and rates - up to £15 a day. Most of the major banks have made changes to their unauthorised overdraft fees over the past 12 months, which suggests they are struggling to prove these fees are fair. The banks have always argued that their charges reflect the costs associated with managing unauthorised borrowing. If this is the case, I would question how they have been able to reduce their costs so significantly?

"When we consider that moneysupermarket.com research* shows over half of the UK workforce was overdrawn at least once in the past 12 months, and 17 per cent were continually overdrawn, we can see that a significant proportion of RBS customers could easily rack up a steep bill if they have to regularly pay the daily unauthorised overdraft fee at £15 a pop.

"Our advice is to avoid unauthorised overdrafts whenever possible - for most people this means a simple call to their bank. If you do continually go into the red then consider switching to a more competitive current account, such as one from Alliance & Leicester, which has a zero per cent interest rate for 12 months and will only charge 50 pence per day, maximum £5 per month thereafter on authorised borrowing."

ends

*Opinium Research carried out a poll of 1,994 British adults from March 3 to 5, 2009
 

Provider

Account

In-Credit Rate
(AER)

Authorised Overdraft Rate (TYPICAL EAR)

Unauthorised Overdraft Rate (TYPICAL EAR)

Unauthorised Overdraft Rate Charges

Alliance & Leicester

Premier Direct Current Account

6.00%

0%
(Introductory Rate for 12 months,
 50p per day, max £5 per month thereafter)

0.00%
(£5 per day)

Exceeding overdraft limit fee: £5 per day
Payment review fee: £25 each item

Abbey

Preferred Overdraft Rate Account

0.10%

0%
(Introductory Rate for 12 months, 12.9% thereafter)

28.7%

Instant Overdraft Monthly Fee - £25
Transaction £0-£9.99 will cost £5
£10-£19.99 will cost £15
£20-£29.99 will cost £25
Over £30 will cost £30

Barclays

Barclays Bank Account

0.00%

0%
(Introductory Rate for 12 months*, 19.3% thereafter)

£22 once in Personal Reserve

Returned/Guaranteed Transaction Fee, max of 5 per day
(comes into effect once Personal Reserve has expired)

Nationwide BS

FlexAccount

0.00%

18.9%

18.9%

Unauthorised Overdraft Charge - £20
Unpaid Item Fee - £30
Paid Item Fee - £21.50

Lloyds TSB

Classic Plus Account

2.50%

18.90%

18.90%

Monthly Fee - £15 per month
Daily Fee:- Less than £25 - £6 a day
£25 to £100 - £15 a day
More than £100 - £20 a day

Halifax

Reward Current Account

£5 per month

£1 per day up to £2,500
£2 per day over £2,500

0.00%
(£5 per day)

Exceeding overdraft limit fee: £5 per day

HSBC

Bank Account

0.00%

19.90%

19.90%

1st overdraft in 6 months = free
Subsequent overdrafts = £25
Overdraft Fee -
Up to £10 = no charge
Up to £25 = £10 per item
Above £25 = £25 per item

NatWest
RBS

Current Plus Account
Interest Paying Current Account

0.10%

19.24%

29.69%

Maintenance Charge - £28
Paid Referral Fee - £30 (max. £90 per month)
Guaranteed Card Payment Fee - £35 per transaction
Unpaid Item Fee - £38 (max. £114 per day)

NatWest - as from 1st October 2009
RBS - as from 1st October 2009

Current Plus Account
Interest Paying Current Account

0.10%

19.24%

19.24%

Maintenance Charge - £20
Paid Referral Fee - £15 (max. £90 per month)
Guaranteed Card Payment Fee - £15 per transaction (max £90 per month)
Unpaid Item Fee - £5 (max. £50 per month)

*Introductory rate may be withdrawn at any time

Sourced by www.moneysupermarket.com 11.09.2009

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Paul Lawler - PR Manager (Financial Services)
078723 79545
01244 370317
paul.lawler@moneysupermarket.com

 

Nicola Parry - PR Officer (Financial Services)
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01244 370318
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Ian Williams
Director of Communications

07515 329671
01244 665793
ian.williams@moneysupermarket.com

 

Clare Francis
Site Editor

07595 067818
01244 220650
clare.francis@moneysupermarket.com