Drastic drop in overdraft fees for RBS-Natwest customers

08/09/2009

Bounced cheques add even more strain to mounting debt, but the RBS-Natwest group has taken the lead to be the first to slash its overdraft fees.

From 1st October, if you have an account with RBS or Natwest you'll only be charged £5 for a bounced cheque, instead of the current £38.

The banking group, which is majority owned by the taxpayer, has expressed concern over these fees and say it's good news for customers.

But it could mean bad news for the banks. The banking industry stands to lose £2bn a year if overdraft fees are cut down everywhere.

Around £784m has already been reimbursed to UK customers in 2007 after complaints flooded in that the fees were unfair, and as a result, illegal.

The Supreme Court is now in the process of deciding whether the Office of Fair Trading can take control of these charges – and even though Natwest and RBS are making a positive move for their customers, like all UK banks, they stand to face repaying millions of pounds to their current account holders.

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