overdraft monthly fee added to initial free overdraft

Drist

Hello All

I am with NatWest and applied for an overdraft that was free and only charged interest rate when I used it.

After a couple of years NatWest then sent me a letter stating that they were now charging a monthly fee on top of the interest rate for using it.

I could not and cannot move my account to avoid these charges and I am now stuck with a free overdraft that is now charging a monthly fee.

Has anyone else had this experience and is there any recourse to have the monthly fee removed. After all they are making money from interest charges without the monthly fee.

D.

grumbler

Drist wrote: »

I am with NatWest and applied for an overdraft that was free and only charged interest rate when I used it.

After a couple of years NatWest then sent me a letter stating that they were now charging a monthly fee on top of the interest rate for using it.

I could not and cannot move my account to avoid these charges and I am now stuck with a free overdraft that is now charging a monthly fee.

Has anyone else had this experience and is there any recourse to have the monthly fee removed. After all they are making money from interest charges without the monthly fee.

Couple of years?!
What recourse? All overdrafts are intended for short-time borrowing only and are repayable on demand.
Be grateful that they have not asked you to repay it on short notice.

Look for some long-term and less expensive way of borrowing for repaying the overdraft, e.g. a loan or a credit card:

• Cheap Loans
• Balance Transfer Credit Cards

Drist

Lots of people have overdrafts that are arranged wheather they use them or not. I dont expect to be charged for the privalage especialy when the arranged overdraft is given free and then charged later wheather its used or not.

The interest rate on any use of an overdraft is the fair way of applying charges not applying a fee wheather you use the overdraft or not.

Be grateful that they have not asked you to repay it on short notice.

Repay what on short notice? Charges for having an overdraft. They do every month and no i'm not grateful.

grumbler

Repay the overdraft.
Sorry if I misunderstood you. I thought you were using the overdraft.

What I see on the website is

There are no set up fees for an Arranged Overdraft, but you could be charged an Arranged Overdraft Usage Fee and interest for using an Arranged Overdraft, depending on the type of current account you have, how much of the limit you've used and how long you use it for.

Sounds like they charge for using the overdraft, not for having it available.

If so, you shouldn't be charged if you don't use it.

Sinhanada

Drist - the overdraft can be recalled at any point by Natwest without them having to give you a good reason.

As for the charges with the Natwest overdraft, this charge only applies if you go into your overdraft during the month. If you don't then it does not charge you.

Most bank accounts charge for overdrafts now unfortunately. Thank the unfair overdraft charges that banks were repaying and the mess that that left

Drist

Thanks for the clarification of charges. Still seems unfair to me. Having no fee for an arranged overdraft and then the bank changing this and adds one. The fair way to handle overdrafts would be to apply an interest rate not both.

NatWest goodbye to unfair banking Hello to sneaky charges.

D

colsten

Overdrafts used to be subject to a %age overdraft fee. Then millions of people, represented by consumer rights activists and organisations, campaigned against it as they said it is too difficult to understand what the actual charges are. The banks duly implemented a simpler to understand charging mechanism.

I suppose if you have a gripe about banks not using %ages, you should take the issue up with those campaigners. May be you manage to succeed where others have failed and can convince them that %age rather than fixed charges would work in their favour.

grumbler

Drist wrote: »

....NatWest goodbye to unfair banking Hello to sneaky charges.

What's "sneaky" about them? They weren't introduced suddenly or on the sly. You've been warned about them well in advance. It's your fault if you missed/ignored the notice.