The table below highlights why the FCA today announced that it wants to abolish fixed fee overdrafts – you can see how much of an income generator it is for some of the big banks.
| Bank | Account | Tariff for agreed overdrafts | Cost to borrow £500 for 7 days | Equivalent interest rate |
|---|---|---|---|---|
| NatWest/RBS | Select | £6 monthly fee + 19.89% EAR | £7.75 | 81% |
| TSB | Classic | £6 monthly fee + 19.85% EAR (first £25 free) | £7.67 | 80% |
| Santander | 123 | £1 per day up to £2,000 | £7.00 | 73% |
| Barclays | Bank Account | 75p per day up to £1,000 | £5.25 | 55% |
| Lloyds Bank | Classic | 1p per £7 borrowed per day | £4.97 | 52% |
| Halifax | Reward | 1p per £7 borrowed per day | £4.97 | 52% |
| Metro Bank | Current | 15% EAR | £1.34 | 15% |
| Post Office | Standard Account | 15.18% | £1.36 | 15.18% |
| M&S Bank | Current | 15.9% (first £100 free) | £1.14 | 15.9% |
| First Direct | 1st Account | 15.9% (first £250 free) | £0.71 | 15.9% |
| Figures at 18.12.2018 |
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