Customers will be charged 'personalised' overdraft rates of up to 49.9% from April, but most will pay 39.9%.
The City regulator has stressed that seven out of 10 bank customers will be better off or unchanged as another big bank announces its new overdraft rates.
"Our changes expose the true cost of an overdraft. We have eliminated high prices for unarranged overdrafts. This will result in a fairer distribution of charges, helping vulnerable consumers."Banks and building societies will no longer be allowed to charge higher prices for unarranged overdrafts than for arranged overdrafts.
However, there will be various tiers, with Club Lloyds customers paying 27.5% but other customers paying up to 49.9%.
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