The Financial Conduct Authority (FCA) today announced a major shake-up of overdraft charges, aimed at fixing a “dysfunctional” market earning banks £2.4bn a year. Overdraft fees vary widely. Even if you agree an overdraft with your bank, you could still pay hundreds of pounds per year in charges. Unarranged overdrafts will charge far more. Somes banks have been improving these charges since late 2017, when the FCA rattled their cages by telling them their high overdraft charges caused consumers harm. But many left their high overdraft fees alone. Today, many of the best buy current accounts also charge hefty penalties for overdrawn sums. Telegraph Money has rounded up some of these charges. Best buy current accounts (ranked by interest rate) Nationwide FlexDirect current account This Nationwide deal tops the best buy tables and is popular with savers for paying 5pc interest for one year on balances up to £2,500. Fee-free buffer: £10 for unarranged overdrafts, none for unarranged. Arranged overdraft fee: 50p a day on balances over the buffer, though Nationwide do offer a 12-month fee-free arranged overdraft for new current accounts. Unarranged overdraft fee: 50p a day on overdrafts up to £10, then £5 a day for borrowing over this limit. This is capped… Read full this story
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