The Royal Bank of Scotland Group announced this week that current and former RBS and Natwest student account holders will learn by November 1st if they are owed compensation or not.
Tens of thousands of student customers had been charged for extended overdrafts that were supposed to be interest-free, over a period spanning from 2002 to March this year.
These students used up the advertised overdraft allowance and were then granted extra. They were then charged for doing so, even though the accounts’ terms and conditions clearly stated that arranged overdrafts were interest-free.
Head of RBS current accounts David Crawford stated in an interview that as a relatively small proportion of the customer base was affected, the bank had not noticed what was happening.
Those affected will be notified by the start of November if they are due a refund; which on average is about £100 per account holder. Those affected will be credited directly into their account or by cheque, with a statutory 8% interest added to the amount.
Mr Crawford said that the bank would use public records to track down those who – as is likely for ex-students – had moved home.
Anyone who believes they have been affected but does not hear from the bank by 1 November, should of course contact RBS to pursue the matter.