Overdraft rates ‘could exacerbate debts’

People struggling financially could be disheartened to learn that overdraft rates are at their highest level in a decade.

New figures released by M…

People struggling financially could be disheartened to learn that overdraft rates are at their highest level in a decade.

New figures released by Moneyfacts.co.uk have revealed that the average overdraft rate now stands at 14.22 per cent, despite bank rates being at an all-time low.

Michelle Slade, spokeswoman for the organisation, stated banks that lost income that was gained from a minority of customers are attempting to recoup the cash from people who use an agreed overdraft facility.

The industry expert advised: “Customers remain reluctant to switch current accounts, but it’s a decision that could leave them out of pocket.”

She said that the UK has some of the highest overdraft rates on the market and recommended considering switching current accounts as the move “could save you hundreds of pounds”.

Research recently released by Link revealed that a record number of individuals withdrew money from cash machines over the May Day weekend.

By Joe Shervin

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