Possibly a stupid question...

moneymagic

I have a basic bank account with halifax, for the use of an electron card (cheaper flights!!) and there is no overdraft available. Does this mean if i spend more than i have i will get stung with charges or will the card simply get declined? Sorry if i'm a bit stupid here...

MM xx

Nigella_2

Normally the transactions get authorized only if you have the funds and the amount is reserved / ear-marked in your account BUT sometimes the transaction will go through.

Shopping once @ Sainsbury my Halifax Electron was authorized where I was a few pennies out, I just paid the ££ in promptly and was ok. Don't know now what would happen as no longer bank with them.

jonesMUFCforever

Most transactions have to be authorised as other posters have indicated.
Some shops can force a payment through (but they run the risk of it being charged back) but if a payment did go through the bank would charge you for an unplanned overdraft.

Sharon87

I went overdrawn on the basic account a few years back, as I transferred money into the account from my ISA and then withdrew it. But then the transferred money disappeared and was left with an 'overdraft' for a few days. It can happen, but not very often.

dc110

If it is a (relatively) small value transaction it may be below the shop floor limit.

A Floor limit for a shop is the amount of money being spent over which they have to check the bank for authorisation. Amounts below the limit can be charged automatically meaning you can spend money you do not have.

Always ensure you have sufficient funds before using your card and dont assume that

"it was authorised therefore I must have sufficient funds"

Probably shouldnt happen on an electron but it can and does happen occasionally so be aware of your balance

bengal-stripe

Equally, sometimes transactions can take longer to come through. After four or five business days, that authorisation (taken off your ‘available balance’) will fall off, if the actual transaction does not show up. So that provisional deduction gets restored and shows up again as ‘available’.

But, like the proverbial ’bad penny’, it will turn up, eventually. If you relied on the balance and have spent that money elsewhere, the transaction will take you overdrawn

Treat every payment as having left your account instantly, no matter how long it will take.

carlos1973

bengal-stripe wrote: »

Treat every payment as having left your account instantly, no matter how long it will take.

Very sound advice.:T
Seven months ago I turned a corner and started to get my finances in order. I changed my cards, I now have a solo (Natwest) as I was told they can't go overdrawn. However this advice was from the bank and ,regrettably, I don't trust it.
I also don't trust balances from ATM's or online banking. The only way I am 100% certain of what I have in my account is to keep all my receipts and enter them on to spreadsheet. I do this for all my accounts, credit cards and cash. It lets me see everything that I have spent and all that I have left.
As I said seven months now and not a single charge. Not easy but it works.

sieve

dc110 wrote: »

If it is a (relatively) small value transaction it may be below the shop floor limit.

A Floor limit for a shop is the amount of money being spent over which they have to check the bank for authorisation. Amounts below the limit can be charged automatically meaning you can spend money you do not have.

Always ensure you have sufficient funds before using your card and dont assume that

"it was authorised therefore I must have sufficient funds"

Probably shouldnt happen on an electron but it can and does happen occasionally so be aware of your balance

Floor limits don't apply to electron, solo, and some visa debits...

Otherwise good advice