Funny that Gordon Brown has chosen the last possible minute before his last ditch General Election to announce that UK banks will finally allow credit cardholders to repay their highest rate charges first - especially when President Obama let this cat out of the bag in May 2009.
When finally implemented, this long overdue requirement will apparently save UK cardholders up to £500 million a year. So it's far less amusing that Gordon Brown appears to have been rather passive on the issue of excessive bank overdraft charges, worth £2.6bn a year. The 20% of overdraft customers with a claim have had to wait years while the Office of Fair Trading has fumbled around in the courts at taxpayers' expense before meekly announcing a 'wait and see' approach to the problem earlier today. No last minute offer of regulation from Gordon there.
Of course, the end of 'negative payment hierarchy' on credit cards is an affordable goodwill gesture for banks. They aren't really in the business of lending money anyway, as the Bank of England found in its February Trends in Lending Report. They're in the business of hoarding it to 'repair their balance sheets' (which largely seems to involve paying bonuses and lobbying for regulatory restraint). By the same token, however, now is not a good time to lose billions in overdraft fee income, regardless of the fact that cash-strapped customers need it more, or that it's a rounding error on the bailout costs to date.
In other words, Gordon Brown is not really committed to ensuring fairness, even when there's a General Election on the line.
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