Urban myth overdaft charge limt

news_to_me
news_to_me Posts: 2 Newbie
in Reclaim bank & credit card charges
I have a friend who is forever telling people that banks can only charge £90 for going overdrawn with your bank account in any one year
When asked to direct poeple to where and when this was written into statutory law they just repeat that it is true. Sounds like a typical urban myth to me, is there such a law and if there is why is it not common knowledge!

Any clarity on this would help shut them up (although it would be nice if true)

Comments

  • [Deleted User]
    [Deleted User] Posts: 26,612 Forumite
    First Anniversary Name Dropper Photogenic First Post
    It's not true.
    It's "overdaft"to believe otherwise! :D
  • Nasqueron
    Nasqueron Posts: 8,785 Forumite
    Name Dropper First Post First Anniversary Combo Breaker
    Your banking terms and conditions cover what is going to be charged, varies from place to place, his bank may have a maximum charge, there is certainly not a blanket rule.


    Barclays as an example charge between £0 and 75p - £2 a day depending on your limit and how much you are in it with a monthly maximum


    Santander have a monthly (not annual) cap of £50!
  • dunstonh
    dunstonh Posts: 116,318 Forumite
    Name Dropper First Anniversary First Post Combo Breaker
    Banks are free to set their own tariff. Many fo the banks have a cap per month that they set. However, there is nothing anywhere near low as £90 a year.

    A guide to overdrafts is here:
    https://www.moneyadviceservice.org.uk/en/articles/overdrafts-explained

    And remember, that the fee is just one part. Interest charged is the other.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • [Deleted User]
    [Deleted User] Posts: 26,612 Forumite
    First Anniversary Name Dropper Photogenic First Post
    Nasqueron wrote: »
    his bank may have a maximum charge
    It won't be only £90 a year!
  • news_to_me
    news_to_me Posts: 2 Newbie
    Thanks everybody for the quick replies and the link
  • Nasqueron
    Nasqueron Posts: 8,785 Forumite
    Name Dropper First Post First Anniversary Combo Breaker
    Moneyineptitude wrote: »
    It won't be only £90 a year!


    I think he's probably got confused about a monthly cap to be honest
  • dunstonh
    dunstonh Posts: 116,318 Forumite
    Name Dropper First Anniversary First Post Combo Breaker
    Or just confused... ;)
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
This discussion has been closed.
★ ★ ★ Meet your Ambassadors

Categories

  • All Categories
  • 343.1K Banking & Borrowing
  • 250.1K Reduce Debt & Boost Income
  • 449.7K Spending & Discounts
  • 235.2K Work, Benefits & Business
  • 607.9K Mortgages, Homes & Bills
  • 173K Life & Family
  • 247.8K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 15.9K Discuss & Feedback
  • 15.1K Coronavirus Support Boards