What is a planned overdraft?

kmb500

Hi, I currently have a £100 overdraft on my TSB current account. I am considering asking them to increase this as I think I may need to use it in the next few months. I am really struggling to understand what it actually means though, as their help website is confusing me. It says that a planned overdraft can only be £25 unless you're a student... my current one is £25 and there is a button on my account saying that I can apply to increase it.


Do I pay interest on using a planned overdraft? I never go into my overdraft so I don't really know.
Any advice would be great, thanks

eddddy

This question might be better on the Budgeting & Bank Accounts board, but anyway...

A planned overdraft is one you've arranged in advance - so it sounds like you currently have a £100 planned overdraft available to you.

An unplanned overdraft is one you haven't arranged in advance. For example, if a direct debit took your overdraft up to £110 - you would have a £10 unplanned overdraft.

The fees for unplanned overdrafts are very high.


Not sure what your saying about the £25 - except that TSB don't charge any fees/interest on planned overdrafts up to £25 on their Classic Account. You pay interest on any amount higher than £25.