With news that the Financial Conduct Authority have slammed the banks’ approach to overdraft charges to customers, we look at ways in which you can take control of your overdraft – rather than it control you.

Extend your overdraft

This may sound like we’re encouraging overspending, but if you’re exceeding your overdraft, it may be worth extending it by a few hundred pounds just to give you some breathing space. This will allow you to work out away of spending less each month and slowly move out of the red.

Go digital

Online banking has a host of benefits for the user. By downloading your bank’s app on to your phone, you will receive notices about the state of your finances – particularly when you’re about to exceed your overdraft. This gives you a bit of time to get some money in the account to avoid being charged.

Sort out direct debits

If your direct debits are scattered throughout the month, you may want to think about having a specific Direct Debit Day. This is the day after payday – say, the second of each month? – where all necessary payments leave your account. This will mean you definitely have the money to cover the expenses and the leftover amount can be budgeted for the rest of the month.


If you’ve been charged any overdraft charges – it’s worth bringing it up with your bank. You can argue that you went over your limit when a payment was promised – but didn’t transfer on time. If you’re having a person-to-person conversation, there should be a more common sense approach to these kind of matters.

Change banks

Be canny with your bank. If you’ve stuck with the same institution you’ve had since you were a student, have a look around and see if any of the other banks have better offers. It might not sound the most interesting of activities, but it could be extremely beneficial to your bottom line.

Bank Overdrafts: Frequently Asked Questions

An overdraft is when you effectively spend more money than what you have in your bank account, there are two different types of overdraft:

Authorised overdraft – An overdraft that is agreed with your bank for a particular reason.

Unauthorised overdraft – Not agreed with your bank and could have criminal connotations if not addressed.

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