The survey, carried out by YouGov in October 2006, revealed that many UK consumers are not taking responsibility for their finances. According to the research, 41% do not know their standard or authorized overdraft rate, despite the fact that 19% are constantly in the red. A mere 23% of those questioned reported that they never use this facility at all.
Although current accounts and overdrafts are still the number one priority of the UK Office of Fair Trading’s (OFT) investigations, responsibility is increasingly falling to account holders and the research reveals that they are doing very little about this.
Stuart Glendinning, managing director of Moneysupermarket.com, commented that, if the OFT forces banks to reduce overdraft charges, the ultimate result will be the implementation of new fees or stricter lending criteria to ensure those consumers always relying on their overdraft are less able to do so.
He said: The OFT’s decision could have a massive impact on the personal banking industry and if people aren’t vigilant they could find themselves being denied an overdraft and thus missing paying some of their bills or even ending up paying other new fees.
According to Moneysupermarket.com, those institutions that are responding to OFT investigations by making changes to their overdraft offerings are not doing so in a way that suits consumers.
Lloyds TSB and HSBC both took steps to reform their overdrafts at the end of 2006 and, at the beginning of 2007, Natwest increased its overdraft charges for the second time in three months.
