Banks to stop counting overdrafts as ‘available funds’ – what you need to know

Former_MSE_Naomi

Three banks have changed the way they show customers' 'available balances' this week, and at least seven more will by mid-December, as the financial regulator brings in new rules on how overdrafts are displayed to customers. But some HSBC and First Direct customers have been left confused by the new changes and worried they've lost cash - so here's a rundown of what's changing and what to look out for...

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'Banks to stop counting overdrafts as ‘available funds’ – what you need to know'

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Consumerist

It won't take long for customers to get used to it and it's a long overdue change, if you ask me.


The true cost of these overdrafts will soon become evident as well when new regulations, with the cost as an APR, come into force in April.


It's going to be a bit of a wake-up call for some in persistent overdraft.

Sea_Shell

Good!! It can lull people into a false sense of security, if available balance includes available overdraft.

DigForVictory

Barclays, who didn’t include it anyway, had a really helpful phone banking app upgrade with screenshots of before & after and explaining why. I’m bemused the other banks didn’t take a look & crib the idea wholesale, especially after the Twitter anxiety.

northwalesd

DigForVictory wrote: »

Barclays, who didn’t include it anyway, had a really helpful phone banking app upgrade with screenshots of before & after and explaining why. I’m bemused the other banks didn’t take a look & crib the idea wholesale, especially after the Twitter anxiety.

Both the Halifax and Lloyds Android apps currently have a link 'Your balance layout is changing' which takes you a webpage where it's quite clearly explained, along with examples of before and after. Doesn't apply to me as none of my accounts have an overdraft facility.

soulsaver

Those that now think they've lost money when they haven't... are better off than before when they didn't think they'd lost money... when they had.. lol!

born_again

So people have just ignored all the stuff that get sent out advising them of the changes.....

Ben8282

soulsaver wrote: »

Those that now think they've lost money when they haven't... are better off than before when they didn't think they'd lost money... when they had.. lol!

I'm sure there will be several threads on the subjuct of money disapearing from accounts ...

Ben8282

Although I can't really see that it makes much difference one way or the other, the idea of showing available funds was not a bad one. The balance and available funds were always shown separately and there should not really have been any confusion. Now people will have to add the overdraft facility to the balance to discover the available funds amount and these days having to do this without an app or text alert or something similar to assist them will be just too much for some people.

jonesMUFCforever

I think this is a stupid idea with no benefits but will cause a lot of confusion to many customers.

Socajam

jonesMUFCforever wrote: »

I think this is a stupid idea with no benefits but will cause a lot of confusion to many customers.

Well then they should keep what little cash they have under their mattress.
If you have to explain to people that you have say 500 in your account and your overdraft is 1500 = 2000
Then something should go off in their brains that out of that 2000, only 500 is really theirs, the 1500 belongs to the bank and it comes with an overdraft fee which is not cheap.
People need to stop wanting something for nothing - that 1500 overdraft is other people's money that the bank lends their customers who have a choice whether to use it or not.
I have a 3500 overdraft sitting there for emergencies only. I refuse to be caught in the overdraft trap that I foolishly did years ago.