First Direct removing overdraft

Yorkie006

Hi,
I've had a current account with First Direct since May 2022. I was also given an overdraft of £1100 (haven't used it but it's nice to have it in case of emergency). I received a letter a week or so ago saying the overdraft will be removed in a month's time (no reason given apart from 'business decision'). I don't have any debts as such (just a small balance on my credit card, but that's only about 5% of the credit limit and repaid in full every month). Considering they're boasting about giving most customers a £250 fee-free overdraft I was hoping to at least keep that, but no, they want to completely remove it. Is this normal? Like I said, I've never used the OD since I opened the account (but would like to have the option in case it's needed) and always have a reasonable balance in the account (+ money in their regular saving account).
Thanks.

MorningcoffeeIV

Yep, all normal.

No point in allocating resources where they're not doing any good.

Lions_89

The same happened to my HSBC account. It was lowered from I think £3000 to £400. A year later (this year) I applied for an OD increase which was denied. 

VXman

I have a £500 overdraft with them. It gets used occasionally when a payment goes out and I don't have enough to cover it. I transfer money to cover it before the end of the day so no charges.

Thumbs_Up

My Halifax account gives me a £200 overdraft, I never used it, clearly Halifax doesn't want me to lose it. However First Direct and NatWest have not given me an overdraft facility probably because I have no credit card history.

jackjones01

Yorkie006 said:

Hi,
I've had a current account with First Direct since May 2022. I was also given an overdraft of £1100 (haven't used it but it's nice to have it in case of emergency). I received a letter a week or so ago saying the overdraft will be removed in a month's time (no reason given apart from 'business decision'). I don't have any debts as such (just a small balance on my credit card, but that's only about 5% of the credit limit and repaid in full every month). Considering they're boasting about giving most customers a £250 fee-free overdraft I was hoping to at least keep that, but no, they want to completely remove it. Is this normal? Like I said, I've never used the OD since I opened the account (but would like to have the option in case it's needed) and always have a reasonable balance in the account (+ money in their regular saving account).
Thanks.

Give them a call - this happened to me with the Halifax and they was like you never use it so there’s no point in having it.  I always make sure I use my overdraft now and pay it back before I get charged. 

[Deleted User]

Do you have your main income paid into the account?

Ballard

I don’t have an overdraft facility on my FD account and enquired about it some time ago. I was told that I’d need to call a team to apply for one but being as I never use an overdraft I didn’t bother. I do often have direct debits put me overdrawn intraday whereupon they text me to advise that I’m overdrawn but won’t be charged on this occasion. 

I think that banks have to consider unused overdrafts in their liquidity reporting so there is an actual cost to them to provide them.