A verdict in the bank charges test case is due this morning, as the Supreme Court is expected to make a decision as to whether they can be governed using fairness rules.

The bank charges case, which has been ongoing since 2007, is between the UK’s leading high street banks and the Office of Fair Trading, and so far, the banks have appealed every ruling made as both the High Court and the Court of Appeal have already decided that bank charges can be judged using fairness rules.

Whether the Supreme Court will find in favour of the banks or the OFT remains to be seen, and this could have major repercussions for the recession hit banking sector.

Commenting, Kevin Mountford, head of banking at moneysupermarket.com said: “A victory for the OFT would be a major triumph for consumers in one sense, however as with all major regulatory change, it’s important to consider the impact for consumers.

“If banks are forced 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 and signalling the end of free banking in the UK.”

He added: “Banks will always find a way to recoup the income they stand to lose if the billions they charge from a violation over overdraft limits, sending out warning letters and returning bounced cheques is deemed unfair.”

It is also thought that the banks could start charging for ATM withdrawals and cheque payments if they are forced to pay back the millions of bank charge claims that are currently pending.

“All consumers could be hit financially if the banks are forced to recoup their lost revenue in other ways, regardless of how they currently use their bank accounts.

“We can expect to see a two-tier banking system developing whereby banks offer superior products and services to more profitable customers and offer a more basic service to others.”

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