The Bank of England base interest rate may be frozen at an all-time low of 0.5%, but overdraft charges are the highest they’ve been for a decade. Shocking new research from Moneyfacts.co.uk has revealed that the average authorised overdraft rate is now a sky high 14.2%.
With many families turning to overdrafts and credit cards in order to weather the recession, these latest findings aren’t going to cast a good light on the banks. Moneyfacts.co.uk looked at five of the biggest banks during their investigation, which outed Barclays as the worst offender. The bank has increased rates on the Additions Active account by a steep 8.4% since 2009. Customers who hold an Additions account have also had to put up with fees shooting up by £2 per month on top.
Few industry experts are surprised by the findings - after they were forced to cut unauthorised penalty charges it was inevitable that they would look to recoup lost profit elsewhere. Unfortunately, this means that everyone who holds an authorised overdraft, a huge percentage of the UK population, is now going to suffer.