A study into the half-year performance of Britain’s largest high street banks has estimated that a total of £200m of ‘unfair’ charges have been refunded to customers who’ve initiated legal action over possibly punitive or excessive charges.

There is huge pressure on the banks over excessive fees, with the Financial Ombudsman receiving around 3,000 calls a day concerning the matter. Campaigners say that as the charges for going overdrawn or missing a payment are far higher than the actual administration costs incurred by the banks, these fees are illegal as punitive charging using charges to boost profits is illegal.

The banks insist that they are following the law fully, although the apparent readiness with which they agree to refunds before reaching court would suggest that they’re not quite as sure of their legal footing as they’d like us to think.

Despite the size of the refunds already made, the £200m figure still only amounts to around 1% of overall profits, although the true picture may only emerge after full accounts for the industry are published.

This entry was posted on Tuesday, July 24th, 2007 at 11:19 am and is filed under Bank Charges. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.