In a Feedback Statement published today, the FCA stated that:
- they have significant concerns about how unarranged overdrafts operate. Charges are high, complex and potentially harmful. Based on the evidence they have to date, they believe there is a case to consider fundamental reform of unarranged overdrafts and consider whether they should have a place in any modern banking market.
- their concerns in relation to arranged overdrafts are about consumers’ long-term use of arranged overdrafts, at levels which are persistent, unsustainable or both. They will now consider whether and to what extent consumers suffer harm from persistent use of overdrafts and whether they should intervene as they are doing in the credit card market to reduce persistent debt.