Pending transactions & overdrafts

ninacat80

I have received an alert saying my balance is overdrawn & to put funds in by 815pm to avoid charges. However, my balance is actually £9.15, I have a payment due of £19.99 but that hasn't actually been processed, it's simply pending. So why have I received this message and why will Santander be charging me for not yet being overdrawn?!

eskbanker

Not sure exactly how it's worded, but if you have enough in the account to settle the pending transaction by 8:15 then you won't be charged, but if there isn't enough in there by that time then you'll go overdrawn and be charged accordingly.

born_again

They may be doing it as pending transactions can debit at any point. 
So in effect they are helping you avoid any potential charges if it debited later on.
Either way at least you can get the funds moved over. 

ninacat80

But that doesn't help. When the money clears in 2-3 days time, I will have more than enough funds to cover it. I think it's grossly unfair that I'm being penalised for being overdrawn when I'm not actually overdrawn because the payment has not yet cleared!! Think I'll take it up with FOS, see what they say given they changed the rules. Think I'll put my money in my mattress if they're all going to be like this. 

eskbanker

ninacat80 said:

I have a payment due of £19.99 but that hasn't actually been processed, it's simply pending.

ninacat80 said:

But that doesn't help. When the money clears in 2-3 days time, I will have more than enough funds to cover it. I think it's grossly unfair that I'm being penalised for being overdrawn when I'm not actually overdrawn because the payment has not yet cleared!!

If the payment shows as pending then they're trying to 'clear' it now, not in 2-3 days time, and that's why, if you don't have sufficient funds, it'll take you overdrawn.  What gave you the impression that this transaction wouldn't be debited for another 2-3 days, is it a standing order or direct debit perhaps, scheduled for 26/27 September?

ninacat80 said:

Think I'll take it up with FOS, see what they say given they changed the rules.

The Financial Ombudsman Service doesn't set or change rules, it just handles consumer complaints.  The Financial Conduct Authority sets and changes rules, but it's not clear exactly what rule you think Santander has broken?

PRAISETHESUN

When a transaction is "pending" it is deducted from your "available balance" as it can in theory be taken at any time. This means if there isn't enough cash in your account to cover the value of the pending transaction that you're actually overdrawn, even though the money won't actually be taken for a few days. Santander is trying to help you avoid being charged fees here - so pay in enough to get you back to a positive balance.

It's also possible that the message you received is completely out of sync with your account activity - I often get reminders that I'm "overdrawn" several hours after I'm already back in credit (down to mis-timed standing orders to move money back and forth between accounts to meet funding requirements). If you're actually already in credit, then it can be safely ignored.

born_again

FOS will not be interested. In fact they may even say it was good banking practise given that a pending transaction can debit at any point.
You have to note that you are not "being penalised for being overdrawn" as you are not overdrawn. They are just pointing out that it is possible you "May" go over your limit.

Just as a heads up. More and more card payments are debiting the same day now. So the days of knowing that spending on a Friday will not debit till Monday or Tuesday have long gone.
I have seen far to many people fall foul of this and incur charges, they could have avoided simply by moving the money from savings to current account to cover the spending.

[Deleted User]

Strictly speaking the easiest way to deal with pending transactions/authorisations is to have an agreed overdraft.
You'll only get charged when you actually use it.