Does Arranged Overdraft build Credit History

[Deleted User]

Asking for a friend
Can you build a credit history and credit score through Arranged Overdraft even if you don’t use your arranged overdraft money as they don’t want to get a high interest credit card.

2021BJ

An unused arranged overdraft will probably have a fairly negligible positive effect on how a lender will view you.

A used arranged overdraft will definitely have a negative effect on how a lender views you.

Why don't they want to get a high interest rate credit card?  They are aware that if you pay it off in full there is no interest to pay right?  And an overdraft won't have that grace period if it's used and the OD interest rates rival those of most high interest credit cards?

[Deleted User]

No-one has a credit score, don't focus on that, it's just a gimmick used to sell you services, lenders never see it
Compare the interest rates / charges - going into an OD and not paying it off vs spending on a CC and not paying it off
If you spend on a CC and pay off in full you don't pay interest

ReecesWaffle

I’ve read that overdrafts don’t help your credit score. Don’t know how true that is however.

[Deleted User]

It depends on how your chosen lender views it. An available but unused OD generally won't do any harm.

Dandytf

I've found exceeding overdraft is very negatively viewed via cra reports.

[Deleted User]

There's a shocker!

Thrugelmir

RahmanQ said:

Asking for a friend
Can you build a credit history and credit score through Arranged Overdraft even if you don’t use your arranged overdraft money as they don’t want to get a high interest credit card.

If you don't borrow money. Then no one is any the wiser. 

cymruchris

Overdrafts are recorded on your credit file - as is their use - I would think it adds a small additional layer of positive credit history, as the bank are happy to trust you with the ability to go overdrawn, and then if you don't use the facility, that shows you're not immensely desperate for cash.

Dandytf

Deleted_User said:

There's a shocker!

🥵
Honestly!