Some of Britain’s leading banks will begin their latest legal defence of their customer charges policies today in a court case worth more than £2bn.

The Office of Fair Trading (OFT) is challenging several high street banks over their policy of charging customers fees for actions outside the normal terms and conditions of their account, such as late payments or unauthorised overdrafts.

Barclays, HSBC, Lloyds TSB and the Royal Bank of Scotland are amongst the banks fighting the OFT claims that the charges, which earn the banks an estimated £2.6bn a year, are unlawful under consumer protection regulations.

The OFT won an initial hearing when the High Court rejected the banks’ claims that the charges were exempt from the regulations, a decision which is now being appealed.

Consumers will however have to wait to find out if they can claim a refund for any charges, with around 750,000 claims currently frozen pending the outcome of the court decision.

Led by several consumer groups, around £1bn in refunds was thought to be paid before claims were frozen.

Although the banks still have permission from the Financial Services Authority (FSA) to impose the charges until the case is resolved, a ruling against the banks could see them being forced to cap, or scrap the charges altogether. That, many experts claim, could see an end to “free” banking and the reintroduction of fees for current accounts.

According to an OFT report released in July of this year, around 12.6 million accounts — 23 per cent of the active total — had been subjected to charges, while more than 1 million customers had amassed charges of £500 or more.