Regulatory AlertsPS19/25: Overdraft Pricing and Competition Remedies
The Financial Conduct Authority issued PS19/25 to implement final rules and competition remedies for UK current account overdraft pricing. The policy mandates that banks adopt a single pricing structure for overdrafts, replacing complex fee and interest rate combinations with either a flat monthly fee or a uniform interest rate to improve transparency and reduce costs for regular users. It also requires lenders to enhance account information, improve switching mechanisms, and submit to ongoing monitoring to ensure sustained competition and prevent the recurrence of high-cost credit practices.
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