UK banks ‘urged’ to charge more for services

Banks in the UK are being encouraged to charge more for their services.

Robert Hingley, director of investment for the Association of British Insurers, told the Financial Times that institutions will remain "uninvestable" if they do not look at their current charging structures.

"It would be pretty difficult for banks to raise any equity in the current environment," he added.

A 38-page report has been produced to support these claims, although any move to alter the price of products would have negative consequences for consumers.

With many household budgets stretched to breaking point, having to pay more for basic banking services could send many families over the edge and force them to seek advice on becoming debt free.

Figures from the Bank of England show that overdraft rates are already at the record high of nearly 20 per cent, which is almost 40 times higher than the base rate.

So any hike on the cost of taking a loan is unlikely to be received positively by people in the UK.

By James Francis