A Norfolk businessman has received a cheque for £35,987.94 from NatWest after challenging the bank over charges levied for bouncing his cheques, The Telegraph reports.

The anonymous entrepreneur suffered cash flow problems after starting up his window and conservatory business eight years ago. Over 28 months between 2000 and 2002, he was being charged £30 fees "virtually every week".

He told BBC Norfolk: "At times I was paying £2,000 to £3,000 a month in charges. I felt I was being ripped off. They were quite happy to take bank charges from us, but were not willing to give us an overdraft."

He later "decided to challenge NatWest after coming across similar cases on the internet", duly issuing a claim for £24,000 in charges and £12,000 in interest back in January. He then "instituted a legal action using the government's Money Claim Online service".

Although a case conference was scheduled for next month, NatWest last Friday dispatched a cheque via Manchester solicitors Cobbett's. An accompanying letter ungraciously explained: "Our client considers that your challenge to its charges would fail in court. Although our client is confident that it will be successful at a final hearing, its legal fees will almost certainly outweigh the value of the claim.

"As such, our client must take a commercial approach to such claims. Without admission of liability, our client is prepared to settle this matter in full to prevent incurring any further legal fees."

The Consumer Action Group has been "urging customers to threaten court action because they claim the banks are unwilling to go to court because they would be forced to admit that their real costs for bouncing cheques were about £2", The Telegraph notes.

The group's Marc Gander described NatWest's payout as "spectacular". He added: "It is the biggest one I know of so far that has been successful. The general message is that the banks are paying out substantial sums to avoid going to court. This idea the banks are not finding it economically viable to contest the case is just not credible."

NatWest declined to comment on the matter, declaring: "We do not discuss individual customers." ®

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