The end of free banking?

Commenting on the High Court ruling over bank charges Kevin Mountford, head of banking at moneysupermarket.com, said: "It will be interesting to see how much reform the OFT will be willing to push for. With so many banks in such a perilous state already, they could be rocked even further if they are forced to refund all customers - noting the level of pending claims.

"It's important to consider what impact this will have on the consumer in the long-term and it seems the end of free banking could well be nigh. If banks have to reduce penalty charges they are likely to introduce a regular charge on current accounts, thus mirroring the system used most consistently across the world.

"Banks will remain resourceful and have to offset any reductions in current account penalty related revenue with other fees. Our user forums and research have shown the replacement of the current system with a roll-out of paid-for current accounts would be a very unpopular development.

"All consumers would be hit in the pocket by this with the banks having to recoup this lost revenue in other ways. If we are to pay for banking though, then one would hope the banks would be motivated to develop more interesting offers and much better customer service."