THE majority of bank customers would rather be hit by expensive overdraft and late payment fees than start paying for everyday banking services, according to new research.

Bank charges, as high as £39 for a bounced cheque, are currently being scrutinised following a test case brought by the Office of Fair Trading (OFT). The OFT believes the fees are disproportionately high and do not represent the costs involved for the banks.

However, there are fears that the banks will consider other ways to raise money, including ending free banking for all customers, if the OFT is able to force a cap on overdraft fees.

That won't go down well with savers, according to a new survey by comparison website Moneyexpert. It reveals that 58 per cent of consumers are not prepared to pay for a bank account and warns that the views of the “silent majority” who manage their account well are not being heard.

Opposition to fee-based banking is particularly strong amongst those who have never paid a bank charge. Around two in three people – 66 per cent – say they would refuse to pay for a current account. The website estimates that over 80 per cent of bank customers don't pay overdraft charges currently.

Sean Gardner of Moneyexpert says: "Given that most people would prefer not to see the end of free banking and would only be prepared to pay a modest monthly fee the majority of bank customers stand to lose if the banks eventually lose this case."

The research shows attitudes towards paying a monthly account fee have hardened over the past 12 months. Of the 39 per cent who would be willing to pay a monthly fee for their bank account, most are only willing to pay between £1 and £5. Just 9 per cent are willing to pay between £6 and £10. Last year, the average ‘acceptable' monthly fee was £7.29.

Given the opposition to regular bank charges some consumer groups say the threat to end free banking is little more than "scaremongering" to put pressure on the OFT to drop its case.

Phil Jones, of Which?, the consumer organisation, says: "Eight out of ten savers say they would switch their bank if it introduced account fees. There is therefore an incentive for banks not to go down that route."