Nationwide will return over £6m to more than 320,000 customers after the Competition and Markets Authority found that the bank had failed to alert the customers before charging them for unarranged overdrafts.
The CMA introduced an order in February last year stating that bank customers with personal current accounts must receive a text alert before the charges can be levied. The order was aimed at giving customers the opportunity to avoid unexpected fees.
“Nationwide failed to do this on numerous occasions and our action today makes it clear they must fix this as a matter of urgency,” said Adam Land, senior director for remedies at the CMA.
The bank admitted contravening the order 20 times, affecting 320,971 customers, according to the authority.
The refund was proposed by Nationwide in a letter to the CMA. The company wrote that it intends to “commence refunds and communications” by November, with the bulk of the refunds made before mid-December.
Mr Land said: “Although we are pleased that Nationwide is going to reimburse customers affected, the CMA needs stronger powers for cases like this, which is why we are seeking the ability to impose fines when firms breach our orders.”
Nationwide recently announced that from 11 November it will no longer charge fees for unarranged overdrafts.
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