overdraft charges!!!!

rickslick

my girlfriend has an overdraft of £3,400. she never goes over the agreed overdraft but still pays a charge of about £45 every month just for being overdrawn. she banks with natwest. is this fair?????

ewan_husahmi

rickslick wrote: »

my girlfriend has an overdraft of £3,400. she never goes over the agreed overdraft but still pays a charge of about £45 every month just for being overdrawn. she banks with natwest. is this fair?????

I make that about 15.9%. Somebody check my maths?

bengal-stripe

Unless it is a promotion, you'll have to pay interest for the monies used.

To have (the permission of) an overdraft is usually free (although some banks charge a setting-up fee)
but to actually use the bank's money, does cost interest.

If, as ewan_husahmi has pointed out, the rate is about 15.9%, that is about the average cost of an overdraft.

Tell your girlfriend to get gradually out of the overdraft, then there is less interest to pay.

LeeSouthEast

15.9% is actually on the cheaper side of the overdraft scale. Some banks charge up to 29.9% for using it.

natweststaffmember

rickslick wrote: »

my girlfriend has an overdraft of £3,400. she never goes over the agreed overdraft but still pays a charge of about £45 every month just for being overdrawn. she banks with natwest. is this fair?????

If that amount is interest on the overdraft then the straight forward answer is yes.

orc_2

The short answer is that the charge appears to be for the overdraft amount.

From what you have said, the charge is not reclaimable.

It is advisable to reduce overdaft to reduce the overall charge.

pippitypip_2

As others have pointed out, that "monthly charge" is not a charge per se for use of the account, it's most likely interest on the overdraft, charged monthly.

Unavoidable and fairly reasonable as banks go..

hth,
pippitypip