The Office of Fair Trading (OFT) has decided to drop its case against the UK banks on whether bank charges are fair. Although this is disappointing, it is far from the end of the story. The OFT may indeed feel that bank charges are far from fair however they are struggling to find an area of the law to challenge the banks. There does still exist however, other avenues for individuals to challenge the fairness of bank charges.  Consumers still have the option of challenging the fairness of bank charges under section 140 of the Consumer Credit Act. Under section 140, the relationship between customers and lenders must be fair.

In challenging the banks on section 140, the most important thing is where the burden of proof rests; and the responsibility rests with the banks to prove that their charges are fair not with the customer to prove they are not!
As the Consumer Credit Act is laid down in a way that emphasises the importance of the relationship between the consumer and the lender, it is likely individual cases have more chance of success as opposed to a collective OFT case.  The real issue with this though is how the poorer families in society afford to fight the banks on this issue. Banks obviously have massive budgets to fight such cases with much of the funds coming from the tax payer!  The safest route for consumers is likely to be through the Financial Ombudsman rather than the courts as this route will ensure no costs. It’s likely the safest route for most will be to take these complaints to the Financial Ombudsman rather than the courts, as then there is no cost. One way to ensure you do not get any bank charges is to ensure you have a buffer between the end of the financial month and payday. If you are looking to reduce outgoings, it may be advisable to look for a loan to consolidate your debts. Secured and unsecured guaranteed online personal loans are available from us and can help you take control of your finances.

Tags: bank charges, guaranteed acceptance loans, OFT

This entry was posted on Tuesday, December 22nd, 2009 at 11:56 am and is filed under Uncategorized. 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.