FCA High-Cost Credit Review - Which? response

Which? welcomes the FCA’s consultation and policy statement on its proposals for overdrafts as part of its high-cost credit review. The FCA has rightly set out a package of reforms, including price constraints and price simplification. These have the potential to dramatically reduce consumer detriment.

As we have noted throughout our longstanding campaign on this issue, overdrafts can provide a potential means for consumers to make up what would otherwise be a shortfall of funds, but excessively high unarranged overdraft fees and charges cause significant consumer detriment to a group of consumers who are clearly identifiable as being financially vulnerable.