Warning issued to Lloyds, Halifax and Bank of | European Markets

Lloyds, Halifax and Financial institution of Scotland prospects face a charge increase from at this time as new overdraft charges take impact.

The shake-up to curiosity charges was introduced by Lloyds Banking Group – which owns all three manufacturers – in August final 12 months and can imply some prospects will see their charge virtually double, from 27.9% to 49.9%.

The bank mentioned that some prospects can pay the identical charge or much less, with some seeing charges drop to 19.9% or 29.9%, whereas others will face a larger charge. 

Lloyds mentioned it’s reviewing everybody individually and the speed prospects shall be charged relies on an “affordability assessment”, which incorporates your credit historical past and how you employ your bank accounts.

In response to MoneySavingExpert, the bank confirmed its customary charge would stay at 39.9% and the “vast majority” of prospects with an organized overdraft can pay both the identical charge, or  much less.

Charges initially elevated in August 2024, when short-term charges of 34.9% or 44.9% had been launched. These short-term charges have now ended and have elevated to both 39.9% or 49.9%.

The adjustments, as of January 31, 2025, imply that each one Lloyds, Halifax and Financial institution of Scotland prospects with an overdraft will now be moved to 1 of 4 new charges of both 19.9%, 29.9%, 39.9% or 49.9%, with the bulk being charged 39.9%. Should you don’t have an overdraft set up in your account then these adjustments gained’t have an effect on you.

Clients whose overdraft charges have modified ought to have obtained a letter, e-mail or textual content from their bank to substantiate this.

You’ll be able to examine what your present charge is by checking your latest present account assertion, or calling your bank immediately.

In case you have been moved onto the best charge it’s value procuring round to see if you will get a cheaper deal some other place.

You could have the option of switching to a completely different Halifax, Lloyds or Financial institution of Scotland account with an interest-free overdraft, or you could possibly decide to modify banks as an alternative if you’ll find a higher offer.

As an instance, First Direct at the moment provides a £250 interest-free overdraft, relying in your credit historical past, whereas Nationwide has a £50 interest-free overdraft offer.