Nationwide will be 39.9% APR on overdrafts - should I switch?

jonesMUFCforever

Can I agree to disagree with you?
I use mine sparingly - never paying interest though just to the amount free as part of a packaged account.

It is handy to have just in case.

SnowTiger

Keep_pedalling wrote: »

On the face of it it would appear that there is no reason to bother with an authorised OD any longer but will banks now take a harder line on unauthorised ODs and bounce more payments that would take you into that zone?

I think it's likely banks will bounce more payments from accounts to prevent them going in to an unarranged overdraft.

This may lead to penalties elsewhere. For example a credit card company might add a £12 late fee to an account following a missed payment and report negative information to CRAs.

eskbanker

SnowTiger wrote: »

Keep_pedalling wrote: »

On the face of it it would appear that there is no reason to bother with an authorised OD any longer but will banks now take a harder line on unauthorised ODs and bounce more payments that would take you into that zone?

I think it's likely banks will bounce more payments from accounts to prevent them going in to an unarranged overdraft.

This is certainly Nationwide's stated intention, as discussed on another recent thread about the changes to their overdraft charges:

https://forums.moneysavingexpert.com/discussion/6034548

An unarranged overdraft is where we may cover a payment, even if you haven’t got enough money in your account or an arranged overdraft with us. In the past, we’d have covered these payments – but to help reduce unexpected fees, they will no longer normally be paid.