Crack down on overdraft charges, campaigners urge
A campaign has been launched today urging the Government to crack down on all forms of credit and stop banks and plastic card companies – not just payday lenders – ripping off borrowers with excessive charges.
Consumer group Which? claims its research has found that overdrafts from high street banks can be just as expensive as payday loans.
For instance, borrowing £100 for 31 days will cost £30 with a Halifax authorised overdraft or £20 with some Santander accounts, while borrowing the same amount for the same time with a payday loan company costs between £20 and £37.
The research also revealed that, similar to rolling over a payday loan, people can rack up sky high default charges if they use an unauthorised overdraft and be hit with high interest and charges if they stay in it for long periods. With the Halifax Reward current account and the Santander Everyday Account it can cost £100 in charges for going £100 into an unauthorised overdraft for a month.
Earlier this month the Financial Conduct Authority announced proposed new rules for payday lenders which will come into effect from April next year. But Richard Lloyd, Which? executive director, said government and regulators “must not lose sight of the urgent need to clean up the whole of the credit market. High street bank overdraft fees can be just as eye-watering as payday loans.”
He added: “It’s time to clamp down on excessive charges and irresponsible lending, and to make sure borrowers are being treated fairly whatever form of credit they’re using”.
The move comes as Labour MP Paul Blomfield tomorrow launches a new cross-party charter – in conjunction with debt, consumer and anti-poverty organisations including Which? and Citizens Advice – that will set out recommendations to ensure the £7.5bn payday loan and doorstep lending sector is treating borrowers fairly.
- 1 The BBC has just done more to eradicate ‘terrorism’ than all our wars since 9/11
- 2 Dog thinks owner is drowning in lake, dives in and tries to pull him out
- 4 Chilling drone footage captures Auschwitz ahead of 70th anniversary of liberation
Auschwitz liberation 70th anniversary: Woman sent to three Nazi death camps describes surviving gas chamber
Saudi preacher who 'raped and tortured' his five -year-old daughter to death is released after paying 'blood money'
Greece elections: Greek PM Alexis Tsipras takes aim at 'neo-liberal' Europe as country gears up for prolonged austerity battle
Pornhub star Mia Khalifa receives death threats after being ranked the site's top adult actress
Prince Philip set to be knighted by Australia: Celebrate by reading his greatest gaffes
'We would evict Queen from Buckingham Palace and allocate her council house,' say Greens
French court convicts three over homophobic tweets, in case hailed as a 'significant victory' by LGBT rights campaigners
Greece elections: Syriza and EU on collision course after election win for left-wing party
British Muslim school children suffering a backlash of abuse following Paris attacks
Islamic history is full of free thinkers - but recent attempts to suppress critical thought are verging on the absurd
Leaked documents show Ukip leaders approve NHS privatisation once it becomes more 'acceptable to the electorate'
iJobs Money & Business
£30000 - £32000 per annum + benefits : Ashdown Group: A highly successful, int...
£18000 - £20000 per annum: Recruitment Genius: This rapidly expanding business...
£25 - 28k + Bonus: Guru Careers: An In-house / Internal Recruiter is needed to...
Negotiable: Recruitment Genius: A Tax Assistant is required to join a leading ...