High-interest overdrafts will hit consumers harder than payday loans
The new rates follow a crackdown – but could see some customers’ costs quadruple, writes James Moore
If there’s one thing that unites this bitterly divided country, it is the view of the banks as complete and utter (insert chosen offensive expletive from Roger’s Profanisaurus). Of late, they’ve been living up to that with bells on.
It has emerged that HSBC is going to impose the usurious overdraft rate of 40 per cent from March 2020, quadrupling the interest paid by some of its customers. This follows a decision by the Nationwide Building Society to charge a similar rate. With these two having taken the plunge, the others are expected to follow suit.
The background to this is the announcement of a crackdown on the “dysfunctional overdraft market” by the Financial Conduct Authority in June.
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