Catherine Stihler, Scottish Labour MEP

Sir,

I am writing with respect to the draconian measures of HBOS, and to warn all Press readers of the dangers and implications of their overdraft charges.

It is absolutely ludicrous of HBOS to impose a charge on their customers of a flat £1 fee for every day they are in their arranged overdraft of up to £2,500.  I am outraged that a high street bank have adopted such a strategy, particularly in the run up to Christmas.   The charges will inevitably compound existing levels of individual debt, to the point where many people will be unable to pay of what they owe the banks.  Moreover, HBO's decision is hardly a stimulus for the economy, and may even prolong the current economic downturn.  Surely it would make more sense for a bank to freeze current overdrafts at their existing levels and encourage people to pay off their debit balance. 

I fear that this is a decision that will do no good for account holders, HBOS or the economy.

Yours sincerely,

Catherine Stihler
Labour MEP for Scotland