Lloyds TSB has announced a cut in the charges it levies on customers who go into the red without prior authorisation, and also a reduction in the amount it charges for bouncing a cheque. It is the first major bank to reduce its fees in light of the ongoing saga over possibly illegal and punitive charging levels, although Lloyds insists that the move is a response to customer feedback and not an attempt to stave off tighter regulation by the Office of Fair Trading (OFT).

The unauthorised overdraft fee, previously £30 a day, will now be reduced to £15 a month with a daily charge of between £6 and £20 depending on the size of the overdraft, while the bounced cheque charge will be cut from £35 to £20.

Further, the interest rate applied to unauthorised borrowing will be reduced to match that applied to arranged overdrafts.

In a new innovation, customers can sign up to a text message warning service which will alert them to a possible unauthorised overdraft, and if the situation can be resolved by close of business on the same day then no charges will be applied at all.

This entry was posted on Tuesday, September 11th, 2007 at 6:17 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.