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British banks have 2m clients stuck in ongoing overdraft
In Great Britain, more than 2 million clients are stuck with everlasting overdrafts. Many of them have found themselves trapped in a so-called “vicious cycle” of borrowing. That’s what a debt charity StepChange informed on Wednesday.
As StepChange told, it had also revealed solid evidence of unaffordable lending in the UK overdraft market as well as cases where financial institutions hadn’t managed to provide their clients with an effective means to deal with their debt.
The charity’s fresh report actually follows changes to overdrafts by some of the country’s biggest banks, and also a highly critical report released by the Financial Conduct Authority that suggested that unauthorized overdrafts could be banned sooner or later.
According to the StepChange report, up to 2.1 million people were overdrawn on a regular basis, moving to the red every month last year.
Overdrafts appear to be one of the most widely employed credit products. The StepChange found out that almost 13 million customers have been overdrawn for the last 12 months.
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