The vast majority of current account holders haven’t a clue how much it costs to go into the red.

And millions think – wrongly – that an overdraft is likely to be cheaper than a personal loan.

Even those who have successfully reclaimed bank charges often can’t confirm how much they were made to pay, says MoneyExpert.com.

In fact, consumer organisation Which? has calculated that the UK’s banks made £4.7 billion from unauthorised overdraft fees and penalty interest last year.

The average interest rate for unauthorised borrowing is around 25 per cent.

And there is typically a charge of £20 to £39 each time you go over your limit without permission or a direct debit or cheque bounces.

Yet more than 40 per cent of those questioned by MoneyExpert admitted they had no idea about the fees their bank charged for unauthorised borrowing.

Many others reckoned it would cost less than £20 a time.

More than two-thirds of those who claimed to know their bank’s authorised overdraft rates underestimated these too, saying they were paying between 5 and 10 per cent.

The actual authorised borrowing average is 12.35 per cent – while personal loan rates start at 6.3 per cent.

MoneyExpert chief Sean Gardner says: “While it’s ultimately the customer’s responsibility to avoid going beyond their overdraft limit, banks should make their charging structures more transparent.

“They could also provide a clearer indication of when customers are close to going in the red.”

These are lovely ideas, but with so much money being made from customer ignorance, why on earth would the banks want to change their ways?