Overdraft charges

Hi, I got a letter through from my bank yesterday saying that if you go into the first £500 of your overdraft you won’t be charged. Not sure if this is applicable for every bank yet but may be worth checking out.

Hi Hannah,

The FCA’s latest guidelines are that the first £500 of an overdraft should be interest-free for now. Some systems won’t have caught up with this, and you may have accidentally been charged. However, if you went into an overdraft and didn’t have one agreed with the bank beforehand, they can charge you for that. The same goes for if you go over £500 (or, if your agreed limit was say £350 and you went over that) – you’re still going to get charged interest on the amounts above the limit.

Definitely give your bank a call to see if they can refund the charges!

I also received an email from Barclays telling me overdraft charges were suspended. Good to know.

Michael’s right – especially right now, banks are being urged by the FCA to demonstrate increased forbearance. They’re getting thousands of calls every day right now, and most customers are finding that it’s easy to ask for payment holidays – and that they’re not feeling ‘judged’ for doing so.

Interestingly, I wonder if the stigma of debt will change over the coming months?

Hannah wrote:

I’ve just been charged for going into my overdraft, not much, but I don’t have the money to cover the costs as I’m waiting for Universal Credit payments to come through.

I thought banks were scrubbing charges during this time, what bank is it? im sorry to hear this. I hope you get the universal credit soon, and that the bank can be reasonable and scrub it on this occasion.