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

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  • jonesMUFCforever
    jonesMUFCforever Posts: 28,898 Forumite
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    I don't think anybody is looking for something for nothing here - its just stupid IMO that anybody needs telling in the way that they are doing now what available balance is and whether they are using an overdraft or not.
  • born_again
    born_again Posts: 14,435 Forumite
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    jonesMUFCforever wrote: »
    I don't think anybody is looking for something for nothing here - its just stupid IMO that anybody needs telling in the way that they are doing now what available balance is and whether they are using an overdraft or not.

    I see this as a precursor too....
    The regulator coming down hard on overdrafts. So the vast majority of people will not be having one.
    Life in the slow lane
  • Blackbeard_of_Perranporth
    Blackbeard_of_Perranporth Posts: 7,605 Forumite
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    Good. My available balance remains the same. Exactly what I have left in my bank.
  • Robisere
    Robisere Posts: 3,237 Forumite
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    jonesMUFCforever wrote: »
    I don't think anybody is looking for something for nothing here - its just stupid IMO that anybody needs telling in the way that they are doing now what available balance is and whether they are using an overdraft or not.

    The real stupidity is demonstrated here on this forum many times by people who have not understood that an overdraft is a debt. When the overdraft gets bigger and the bank decides to either demand it back or close their accounts, there is a sorry tale on here. An overdraft is debt and people need to understand that. I applaud this move. I have been in debt myself, through no fault of my own, but not for many years. Nowadays I have a £250 overdraft that I did not want, I am fortunate and careful enough to have avoided using an overdraft with the 3 banks I have been with, for over 30 years.

    It's all about managing your money. I like to see my account balance showing as what I actually have.
    I think this job really needs
    a much bigger hammer.
  • Missus_Hyde
    Missus_Hyde Posts: 531 Forumite
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    edited 30 November 2019 at 6:32PM
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    Socajam wrote: »
    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.

    Quite.

    So the banks are having to state the blindingly obvious to help their customers manage their money successfully. :p
    A cunning plan, Baldrick? Whatever it was, it's got to be better than pretending to be mad; after all, who'd notice another mad person around here?.......Edmund Blackadder.
  • born_again
    born_again Posts: 14,435 Forumite
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    Missus_Hyde wrote: »
    Quite.

    So the banks are having to state the blindingly obvious to help their customers manage their money successfully. :p


    Oh Yes......:j

    Something that the regulator thinks Joe Public need :rotfl:
    Life in the slow lane
  • soulsaver
    soulsaver Posts: 5,969 Forumite
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    Maybe the regulator is trying to force banks to recognise that some members of the public have more challenges than others.
    Top Easy Access acs Ranked by rate: Top of The Pots - **No Chat** — MoneySavingExpert Forum
  • Ben8282
    Ben8282 Posts: 4,821 Forumite
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    Robisere wrote: »
    The real stupidity is demonstrated here on this forum many times by people who have not understood that an overdraft is a debt. When the overdraft gets bigger and the bank decides to either demand it back or close their accounts, there is a sorry tale on here. An overdraft is debt and people need to understand that. I applaud this move. I have been in debt myself, through no fault of my own, but not for many years. Nowadays I have a £250 overdraft that I did not want, I am fortunate and careful enough to have avoided using an overdraft with the 3 banks I have been with, for over 30 years.

    It's all about managing your money. I like to see my account balance showing as what I actually have.

    I think you are missing the point.
    Your account balance does show as the amount that you actually have!
    Available funds shows the amount available which rightly includes the overdraft limit as that is the amount available for withdrawal.
    Example with a £250 overdraft limit:
    BALANCE £1000 AVAILABLE £1250
    What is confusing about that?

    It is nothing to do with encouraging overdraft use or getting into debt.
  • Ben8282
    Ben8282 Posts: 4,821 Forumite
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    born_again wrote: »
    I see this as a precursor too....
    The regulator coming down hard on overdrafts. So the vast majority of people will not be having one.
    Could you clarify what you mean here. Are you saying the vast majority of people will not want one or that you believe that the vast majority of people are going to have their overdraft facility taken away? Just curious.
  • Timewarp
    Timewarp Posts: 76 Forumite
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    The confusing thing is the difference between available funds and current balance, including or not including pending transactions.

    As an example for £500 in the account, £500 o/d and £10 just spent Smile Co-op showed available as £990 and current balance as £500.

    Means you can't see at a glance without doing some basic arithmetic each time. Simple with the above, not so much with several pending for varying amounts.

    Co-op only changed this recently because they had to, they haven't done it for more than three weeks like the article seems to suggest that it was a longstanding thing. Smile made the change clear in their communications, to their credit.
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