If you are a victim of unfair bank charges, you may be able to claim them back.

Banks often charge up to £70 to customers who exceed their agreed overdraft limit, however the law is clear that these charges should be to cover administration costs, not a penalty, making this bank charges excessive and unfair as the charges do not reflect the loss incurred by the bank.

Consumers are now writing to their banks to reclaim these unfair charges, arguing they are excessive and illegal. With the introduction of the new Money Claim Online site, victims of the charges can now easily file a claim with the small claims court against their bank should the bank not cooperate. Often the banks payout before it gets to the court stage to avoid precedents being set.

Here is a breakdown of how you can claim back these unfair bank charges:

Step 1

Calculate the charges. If you have kept all your statements for the past 6 years, great! If not, write to your bank and request a breakdown of all charges incurred. The maximum you can claim back by law is 6 years. You can request this information under the Data Protection Act.

Step 2

Write to your bank and ask for the money. Say you are a loyal customer who finds the charges unfair. You should quote the recent OFT ruling and also provide a breakdown of the charges, when and why they were incurred.

Step 3

If your bank respond positively, well done! If not, write to them again, but be firmer. Give a timescale of 14 days for a response.

Step 4

Now is the time for the Courts. It could be a lengthy process - nobody said this would be easy! Read everything you can about these unfair bank charges and how to reclaim them. And don't give up!

One thing you may want to remember, the bank is perfectly entitled to close your account for causing them this headache so make sure you have a backup.