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MSE News: Co-operative Bank to suspend overdraft interest for three months

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MSE News: Co-operative Bank to suspend overdraft interest for three months

edited 30 November -1 at 1:00AM in Budgeting & Bank Accounts
20 replies 3.9K views
MSE_GuyMSE_Guy MSE Staff
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I've been Money Tipped! Newshound! Chutzpah Haggler
edited 30 November -1 at 1:00AM in Budgeting & Bank Accounts
This is the discussion thread for the following MSE News Story:

"Co-op will give a respite to some customers, but those who breach their overdraft limit will still pay fees of up to £20 a time ..."
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Replies

  • Very generous indeed considering they declined my overdraft request.
  • VT82VT82 Forumite
    1.1K posts
    The news item is about an interest free overdraft, so why is the tagline above, and two thirds of the article, about unauthorised overdraft fees? And yet no mention is made of the stoozing opportunity. Feels a bit like a vendetta...
  • I only just got a co-op account, which came with a £200 interest free overdraft....does that mean that will be gone after april?
  • Anybody who currently has an overdraft with Co-op should take this as an opportunity to reduce their debt rapidly over the next few months.

    Go for it!
  • jamesdjamesd Forumite
    24K posts
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    Why turn down the free money by paying it off? Put the money that would have been used into a savings account instead. Then use the free interest earned on the savings account to reduce the overdraft by more once the interest free period ends.
  • YorkshireBoyYorkshireBoy Forumite
    31.4K posts
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    jamesd wrote: »
    Why turn down the free money by paying it off? Put the money that would have been used into a savings account instead. Then use the free interest earned on the savings account to reduce the overdraft by more once the interest free period ends.
    I'm not saying don't do it, but you'll only make £6 net per £1,000 of available facility over the 3 months in a 3% paying account.

    When you factor in the risk of inadvertently dipping into unauthorised overdraft territory, those not completely on top of their finances may wish to give it a miss.
  • jamesd wrote: »
    Why turn down the free money by paying it off? Put the money that would have been used into a savings account instead. Then use the free interest earned on the savings account to reduce the overdraft by more once the interest free period ends.
    While you are of course correct, I was in the mode of comment that I would use in the loans forum.

    Speaking very generally, those with debt invariably rely on it. Cheap debt encourages them to get more debt that they don't then pay off. Leaving them in a worse position than they started out with.

    So yes, stooze away to your hearts' content. But get the debt cleared at the last minute (a day or two before it becomes subject to charging) so you never pay any interest again!
  • marmsmarms Forumite
    295 posts
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    VT82 wrote: »
    The news item is about an interest free overdraft, so why is the tagline above, and two thirds of the article, about unauthorised overdraft fees? And yet no mention is made of the stoozing opportunity. Feels a bit like a vendetta...

    A basic rate tax payer would need an overdraft of £4000 earning you 2.5% elsewhere just to cover the £20 setup fee.
  • VT82VT82 Forumite
    1.1K posts
    marms wrote: »
    A basic rate tax payer would need an overdraft of £4000 earning you 2.5% elsewhere just to cover the £20 setup fee.
    Then the article could have mentioned this in between all the bank-bashing?
  • dougz_2dougz_2 Forumite
    523 posts
    Part of the Furniture Combo Breaker
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    Any customer who applies for and receives a formal overdraft while the offer is running will pay no interest
    Bit of a kick in the teeth if you have already paid the annual setup fee recently?
This discussion has been closed.

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