Banks 'not letting customers understand charges'

British banks are not giving customers the chance to fully understand the changes they face for overdrafts.

The Office of Fair Trading (OFT) has made a formal reply to defences given by banks over charges ahead of a forthcoming High Court test case, claiming charges are currently "disproportionate" for overdrafts.

The watchdog added terms and conditions "do not provide the consumer with a fair opportunity to understand how they apply".

It added bank account terms are not "clear and transparent" nor were they in "plain intelligible language", so they could mislead customers.

Although claims against banks for unfair charges are now on hold because of the test case, customers are still advised to file claims, which can go back up to six years.

The British Bankers' Association (BBA) responded by saying its charges for unarranged overdrafts were "fair and clear".

The body also welcomed the case, offering the chance of greater clarity for both banks and customers.

Read more about the story at our sister site inthenews.co.uk