Banks urged not to charge indebted customers

British banking groups have been urged not to levy charges for unauthorised overdraft use against their customers who are already in debt, it has emerged.

Citizens Advice, which provides guidance to millions of people in debt management trouble each year, is keen to see banks behave reasonably when it comes to issuing charges.

“We need to see banks sticking to their own code of practice by ensuring they don’t impose unreasonable charges on people already in debt, people on benefits and customers with basic bank accounts,” a statement from the charity read.

The comments from Citizens Advice follow a ruling from the High Court that means the Office of Fair Trading can decide what represent unfair banking fees and regulate relevant parties when it sees fit to do so.

Meanwhile, a recent study by MoneyExpert revealed that the rate of rejection among credit card applicants in the UK is rising dramatically.