Small businesses will face a 6per cent surcharge on unauthorised overdrafts, following the adopt ion of new international rules on capital allocation by banks, a leading banker has warned.
John Kelly, of the Business Strategy Unit at AIB, said that the new Basel rules on capital adequacy require banks to allocate greater capital for accounts which are overdue.
Kelly said that banks no longer had the discretion to waive surcharges on unauthorised overdrafts.
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