The payday lending industry, which will come under tougher regulation next year, has come under heavy criticism for encouraging people to roll over debts so the original cost balloons.
Research from consumer group Which? found going overdrawn can be as "eye-wateringly" expensive as taking a payday loan and, in a similar way to rolling over a payday loan, people can rack up "sky high" default charges if they slip into an unauthorised overdraft.
Which? found that borrowing £100 for 31 days will cost £30 with a Halifax authorised overdraft or £20 with some Santander accounts, while borrowing the same amount for around a month with a payday loan firm such as Quickquid or Wonga costs between £20 and £37.
Which? is calling for the Financial Conduct Authority to ban excessive charges across the whole consumer credit market so that default charges reflect lenders actual costs. It also wants to see a cap on default charges.
Richard Lloyd, Which? executive director, said: "The Government and regulators have rightly focused on the scandal of payday lending, but they must not lose sight of the urgent need to clean up the whole of the credit market. High street bank overdraft fees can be just as eye-watering as payday loans."
Anthony Browne, British Bankers' Association chief executive, said overdraft charges for customers had fallen "significantly" recently. "The higher figures quoted by Which? are based on extreme examples of unauthorised overdrafts."