You don’t need to do anything, as long as you want to keep your limit the same. The first £500 will be automatically interest free until 31 October 2020. Anything you use above that will be charged at 9.1% (variable).
During these uncertain and challenging times, we’re here to help. To make everyday banking easier as a temporary measure we’ve made the first £500 on arranged overdrafts interest free on personal current accounts.
- The first £500 on arranged overdraft is now automatically interest free. We’re not charging any interest on arranged overdrafts up to £500 until 31 October 2020. Your current overdraft limit hasn’t changed. If your arranged overdraft is lower than £500 all of it will be interest free. If you want to increase your overdraft limit, you’ll need to apply.
- When you go into overdraft we won’t charge you the £7 monthly fee (arranged overdrafts) and £7 daily fee (unarranged overdrafts) anymore.
- We’re keeping our interest rate at only 9.1% (variable) for overdrafts above £500.
0% EAR variable on first £500
9.49% EAR* (variable) on anything above that, giving a representative rate of 5.5% APR** (variable)
*EAR stands for ‘Effective Annual Rate’. It is a representative interest rate that shows the rate you would pay if you remained overdrawn for a year. It takes into account the compounding of interest which means you pay interest on interest already charged.
**APR is the annual rate charged for borrowing, expressed as a single percentage number that represents the actual yearly cost of funds over the term of the arranged overdraft.
I already have an overdraft -Your current overdraft limit hasn’t changed. If you need to increase your overdraft limit, you’ll need to apply.
I don’t have an existing overdraft -You can apply for a new arranged overdraft.
Good to know
Arranged overdrafts are useful for short-term borrowing and emergency funds. You can find more information on our Overdrafts page
When you apply for any borrowing, as always we’ll look at your financial circumstances and eligibility. In these unprecedented times if you’ve been financially impacted, we’ll look at your pre COVID-19 financial circumstances instead.
When you apply for an arranged overdraft we will carry out a credit check with Equifax, a licenced credit reference agency which is standard practice with all lending applications. Credit Reference Agencies record details of our search and this may effect credit applications you make elsewhere.
My current overdraft limit is for £600 – do I need to do anything to get the interest free amount?
I currently have an arranged overdraft for £250 – do I need to apply to increase my overdraft limit to £500.00?
Yes, you’ll need to apply if you want to increase your limit. Your £250 limit is automatically interest free. To use up to £500 interest free you’ll need to apply to have your limit increased. You can do this through Online Banking, or by completing a call back form to speak to a Customer Services Adviser, or drop into your nearest branch.
I don’t have an arranged overdraft at all – how can I apply for one?
You can apply for an arranged overdraft through Online Banking, or by completing a call back form to speak to a Customer Services Adviser, or drop into your nearest branch. All borrowings are subject to status and eligibility. We want to help, so in these unprecedented times we’ll look at your pre COVID-19 financial circumstances.
When you apply for an arranged overdraft, we will carry out a credit check with Equifax, a licenced Credit Reference Agency (CRA). This check includes information such as how you operate your account and any existing overdrafts or borrowings. Credit Reference Agencies also record details of our search which may affect lending applications you make elsewhere.
Will I still have to pay interest when I use my arranged overdraft?
Will I still get text alerts when I go overdrawn?
Yes, we’ll keep sending you text alerts when you go into your arranged overdraft to help you manage your money. We’ve automatically set you up for these alerts if we have your mobile number and will let you know when you’re about to go into overdraft or over your limit. If you want more information on text alerts or how to update your mobile number on your personal details please click here.
Will my existing terms and conditions need to change?
No, these are temporary measures put in place to help customers in unprecedented times. Your terms and conditions will remain the same.
What happens when the interest free period finishes in October?
I’m worried about other payments?
If your financial distress is not as a result of Covid-19, or if you think your situation will get worse, we have long-term repayment solutions that may help you. For more information, see https://aibni.co.uk/worried-about-payments.