A new report has found that British households are losing an estimated £430 a year to the profiteering habits of banks . The report, which has been jointly produced by think tank The Financial Inclusion Centre and trade body Co-operatives UK, found that banks raked in £11.2 billion in charges and fees over the past 12 months, equating to £430 per household. £8 billion of this margin comes from charging borrowers a higher interest rate on loans than the banks are offering savers on their money, with the other £3.2 billion sourced from bank and credit card charges, based on the Office of Fair Trading's estimates (OFT).
Secretary General of Co-Operatives UK, Ed Mayo, described the profiteering as a 'hidden tax', and called for closer scrutiny on the banking system. Meanwhile, co-author of the report, Mick McAteer - head of the Inclusion Centre think tank - cited a lack of competition as the major reason for the profiteering habits, suggesting that too many banks are owned by a small number of companies.
The report acknowledges that banks have always made their money by charging high rates on loans than on savings accounts, but claims the current rates have earned banks £8 million more this year than the average for the past decade.
Bank Profiteering Harming Households
Financial Services > e-banking > Banking news
Bank Profiteering Harming Households
Fri, 09 Jul 2010
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