08 July 2008
The competition watchdog is due to reveal figures showing that the UK's major banks make £2.5 billion a year through unauthorised overdraft charges.
The Office of Fair Trading (OFT) is expected to put a figure on the amount made by banks from the charges when it publishes its market study into current accounts and unauthorised overdraft charges later this month.
The move follows the OFT's recent High Court victory on the issue of unauthorised overdraft charges. A second hearing to decide whether the charges are unfair, and what a fair charge should be, will be delayed pending the outcome of an appeal against the judgement by the eight banks involved.
The OFT is expected to say in its market study that the banks in question made £2.5 billion through unauthorised overdraft charges in 2006. Previous estimates had put the figure at between £2 billion and £3.5 billion.
Industry experts are also expecting the watchdog to say what a reasonable charge for the service would be, as well as looking at how transparent the charges are and how easy it is for consumers to switch banks.
A spokeswoman for the OFT confirmed that it was due to publish a market study later this month, but declined to comment on the speculation regarding its contents.
Banks can charge as much as £35 for a single bounced payment, but campaigners have claimed that the actual cost for such a transaction could be as little as £2.50.
Annual results for the major high street banks show they have so far paid out more than £559 million in refunds to customers who complained about unauthorised overdraft charges.
Copyright © PA Business 2008