The rules and regulations I propose here refer principally to the High Street retail banks and personal bank accounts. However, they could also apply to business accounts.
The mission statement or purpose of the bank is to increase the wealth of its customers.
An individual bank account shall be made of three sections; a "paying in" section into which wages, benefits and other monies are paid. And a "paying out" section for regular payments out to Utilities and other businesses. The bank will not allow a direct debit to take money out of the account if there are insufficient funds to make the full payment. It will or should be illegal for a direct debit request to do this. There will also be a second "paying out" account for the debit card. The account holder will then be protected from having the whole of their account "cleaned out" by a card fraud.
A bank will also be required to offer Term Savings accounts. This will enable customers to save for a particular item or event. The customer decides the length of the term in months and the minimum amount to be paid each week or month. The money would not be allowed to be withdrawn until the date decided by the customer. e.g. In January, a customer may decide to save up for Christmas and want to withdraw their savings on December 7th. Supermarkets already do this with savings stamps; is it not better for the bank's customers to earn the interest rather than the supermarkets?
A savings account that one of the High Street banks already operates is a good scheme whereby purchases made by debit card are "rounded up" to the nearest pound and that amount is deposited in the savings account.
Penalty Charges will be illegal and unnecessary.