James Frith MP is celebrating following a successful campaign by him and a cross-party group of MPs with the consumer rights organisation Which? to force the Financial Conduct Authority to take action against rip-off overdraft fees.
Banks made £2.4 billion from overdraft fees last year. A campaign by a group of MPs backed by Which? has forced the FCA into action. The City watchdog has now agreed that the system needs “fundamental change”.
Instead of the current range of fees, daily and monthly charges, there will be a single, simple interest rate. New fees will have to be advertised in a simple way to help customers compare them.
James said: “This is brilliant news. And monumental news for those hit hardest by these fees. A win for every-day life, which represents the biggest intervention in the banking sector for a generation. Banks are making billions from these overdraft fees and it is people in the most deprived areas who are disproportionately affected.”