I have an overdraft limit, why am I being warned of fees?

UK Help
1

I went into my overdraft by about £2 but the limit is £500 but I received a text that said:

“Your last payment took your balance below £0. Add money to your account before midnight to avoid overdraft fees.”

Why would it charge me fees after midnight if I haven’t passed my overdraft limit? Just a little confused.

Thanks for any help

2

Your overdraft isn’t free. If you’re borrowing money, you have to pay for it.

4

If your balance is below £0 then you are using your arranged overdraft and there are fees associated with that.

If you don’t want to pay interest, bring your balance back above £0 before midnight on the day you went into your overdraft and no interest is payable

5

As others have pointed out, since you’re borrowing money, you’ll need to repay it along with the fee.

For overdrafts up to £500, you’ll be charged a certain percentage. If you exceed £500, you’ll face even higher fees.

6

Just to add to the above answers, if you go over your £500 (unlikely but can happen in some cases), Monzo does not charge any additional fees nor do they charge interest for going into an unarranged overdraft any more.

Source:

7

Hi there, cheers I know that much. Usually when I have had overdrafts in the past you pay a fee if you don’t replenish your balance after a certain day of the month, never heard of before midnight. Maybe the UK works differently.

8

UK Overdraft laws were overhauled a few years ago, to make it fairer. People freak out when they hear that there may be a “fee” but in reality it’s not that bad at all now.

I would do some research if it’s something you want to know about, but in short:
Interest is accrued on the balance from day 1 (the day after hitting a negative balance) [Note some banks can offer a grace period before interest begins to accrue].
There is no “fixed fee” (like £10 a month, £1 a day, etc.). The only “fee” is the interest on the balance.

9

Ah I see thank you, I even just checked on their website for an estimate of the fees I’d be paying until I get paid on Friday, they’re pretty minimal so that also clears up my worries a bit. Had to pay for private health care so I’m skint lol cheers for the help!