Overdraft Service: overdraft more details | HSBC UK

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Key product information you need to know about our Overdraft Service

Why have an HSBC overdraft?

An overdraft could give you peace of mind by allowing you to make payments when you have run out of money in your account.

It means with an overdraft it can help you through expensive months like December, or paying unexpected costs such as an emergency plumber.

If you arrange a formal overdraft and keep within your limit it can help you prepare for life's unexpected costs.

Agreeing an overdraft limit in advance

An arranged request occurs when you approach us to arrange an overdraft limit.

There is no overdraft fee for agreeing a formal limit and it gives you greater control of your finances – you'll have an agreed limit within which you know items will be paid without incurring any overdraft fees. It's important to choose an adequate limit because if you go over it you may be charged daily overdraft usage fees, see price list for full details.

Your overdraft limit will be agreed until further notice, we will review the facility annually and contact you if we will be making any changes.

Going overdrawn without agreeing it in advance

An unarranged request is when you authorise a payment that would take your account overdrawn or beyond your arranged limit without agreeing in advance an overdraft to cover it.

We will always consider an informal request and will make the payment if we can, subject to status. If approved the overdraft will be provided for 31 days to cover the item concerned.

Unarranged overdraft usage fees - and how to avoid them

If your overdraft limit is adequate and you don't go above it, all you need pay is the overdraft interest. We only charge a daily informal overdraft usage fee if you are more than £10 in your informal overdraft, see price list for full details.

We will always try to make your payments even if you do not have sufficient cleared funds in your account and the payment would take you over any arranged overdraft facility.

Remember, it's more cost effective to arrange an adequate arranged overdraft than rely on informal overdrafts.

Monthly Maximum Charge when using an unarranged overdraft

Monthly cap on unarranged overdraft charges (effective from 1 August 2017)

  1. Each current account will set a monthly maximum charge for:
    • going overdrawn when you have not arranged an overdraft; or
    • going over/past your arranged overdraft limit (if you have one).
  2. This cap covers any:
    • interest and fees for going over/past your arranged overdraft limit;
    • fees for each payment your bank allows despite lack of funds; and
    • fees for each payment your bank refuses due to lack of funds.

The introduction of the Monthly Maximum Charge will not affect any charging period that ended prior to 1st August 2017. Any notification of charges that are generated on or after 1st August 2017 will incorporate the new Monthly Maximum Charge cap.

Further details, including the level of the monthly cap applicable to each account, can be found online at www.hsbc.co.uk/1/2/overdrafts/details.

How you can keep track of your balance

To try to help you avoid Overdraft fees, we will send you Overdraft text alerts if we've agreed an unarranged overdraft on your account. We will also send you a text alert if there isn't sufficient cleared funds available, in your account, to make a payment. You can opt out of receiving these text messages by calling us.

There are also several other ways you can keep an eye on where your balance is in relation to your overdraft limit.

You can get text message alerts sent to your mobile at no extra cost to let you know you when you’re nearing your limit – you can set these up via Online Banking or by calling us on 03457 404 404.

The HSBC Mobile Banking App lets you manage your personal accounts easily and securely from your mobile phone.

You can use HSBC cash machines, which will warn you if you try to make a withdrawal that might result in you being charged. You can use Internet banking to view balances, statements and payment details - plus increase (subject to status), decrease or cancel your overdraft limit. Or you can ring us on 03457 404 404 any time of the day or night to check your balance using our automated service.

The cost of your overdraft

If you keep within your arranged overdraft limit the only cost you need pay is interest. Here are the rates that apply to overdrafts on our accounts, at a glance.

Monthly cap on unarranged overdraft charges (effective from 1 August 2017)

  1. Each current account will set a monthly maximum charge for:
    • going overdrawn when you have not arranged an overdraft; or
    • going over/past your arranged overdraft limit (if you have one).
  2. This cap covers any:
    • interest and fees for going over/past your arranged overdraft limit;
    • fees for each payment your bank allows despite lack of funds; and
    • fees for each payment your bank refuses due to lack of funds.

The introduction of the Monthly Maximum Charge will not affect any charging period that ended prior to 1st August 2017. Any notification of charges that are generated on or after 1st August 2017 will incorporate the new Monthly Maximum Charge cap.

Further details, including the level of the monthly cap applicable to each account, can be found online at www.hsbc.co.uk/1/2/overdrafts/details.

Name of Account Cost of Arranged Overdraft Cost of Unarranged Overdraft (Monthly Maximum Charge)2
Bank Account Overdraft interest (19.9%)
Representative example (assumed overdraft £1,200):
19.9% EAR variable
£5 daily fee to a monthly maximum charge of £80
Current Account 1 Overdraft interest (19.9%)
Representative example (assumed overdraft £1,200):
19.9% EAR variable
£5 daily fee to a monthly maximum charge of £80
Home Management Account 1 Overdraft interest (19.9%)
Representative example (assumed overdraft £1,200):
19.9% EAR variable
£5 daily fee to a monthly maximum charge of £80
HSBC Advance Bank Account Overdraft interest (17.9%)
Representative example (assumed overdraft £1,200):
17.9% EAR variable
£5 daily fee to a monthly maximum charge of £80
Graduate Bank Account Overdraft interest above interest free entitlement (19.9%)
Representative example (assumed overdraft £1,200): 1st year 0% EAR variable on the first £1,500, 2nd year 0% EAR variable on the first £1,000 and 19.9% EAR on the rest.
£5 daily fee to a monthly maximum charge of £80

1. These accounts are no longer on sale.

2. In addition to any fees, you'll also continue to pay overdraft interest on any arranged balance if you have one. We won't charge overdraft interest on any unarranged balances.

HSBC Premier Bank Account Overdraft interest (0% on first £500 overdrawn then 11.9%)
Representative example (assumed overdraft £1,200): 0% EAR variable on the first £500 and 11.9% EAR on the rest.
Overdraft interest (11.9% EAR variable) to a monthly maximum of £500 on the unarranged overdraft.
Jade by HSBC Premier Bank Account 0% on first £500 overdrawn then 9.9%. Overdraft interest is charged on arranged and unarranged overdraft balances.
Representative example (assumed overdraft £1,200): 0% EAR variable on the first £500 and 9.9% EAR on the rest.
Overdraft interest (9.9% EAR variable) to a monthly maximum of £2,000 on the unarranged overdraft.

In order to reach the monthly maximum charge limit, based on current interest rates, you'd have to be over your arranged overdraft limit by more than £50,000 for HSBC Premier and £230,000 for Jade by HSBC Premier for a full charging month.

3 We'll charge overdraft interest on any arranged and unarranged overdraft balances but no overdraft fees.
* EAR (Effective Annual Rate) takes account of the interest rate and how often interest is charged, and does not include any other fees or charges.

There are various scenarios in which you may be charged a daily unarranged overdraft usage fee. To know more about the situations in which you may be charged, please see these examples of charges.

For details of the charges that may be applicable, please click here to see the relevant Price List.

Account Management Service

Every month we will review your account to make sure your overdraft borrowing is suitable, based on your salary or other income. If we feel that your overdraft borrowing may be too much compared to your income, we will contact you to let you know an appropriate amount to pay in. We will also explain how we may be able to help, in the short and long term, if you are unable to pay in this amount.

How is Bank Account Pay Monthly different?

Bank Account Pay Monthly was specially introduced to help customers keep a firmer grip on their account.

You can request an arranged overdraft facility. You can request an arranged overdraft limit, but whether you have an arranged overdraft limit or not, we'll also provide you with an automatic £50 overdraft buffer on top as a safety net. We'll charge overdraft interest on any arranged overdraft balance, but we wont charge for use of the £50 buffer (effective from 1 August 2017).

The key difference with Bank Account Pay Monthly is that any payment requests that take you over your arranged limit and your £50 buffer will normally be refused. However when payments are returned your credit rating may be affected.

To help you manage your finances, we send text alerts the morning after your balance reaches 60%, 80% or 95% of your overdraft limit. We will send an unpaid text alert when we have made a decision not to pay a Direct Debit, Standing Order, future dated Bill Payment or Cheque due to there being insufficient available balance on your account. You then have until 3.30pm, on the day it is due to be paid, to pay in cleared funds and we will then make the payment. We also offer the Pay Monthly Money Calendar, a quick, interactive tool to help you take an objective look at your spending. Bank Account Pay Monthly is currently available for a fee of £10 a month.

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