An overdraft allows you to pay for something when you would otherwise have no money in your current account.
Overdrafts are available on all our current accounts except for the Cash and Under 19s accounts.
What is an arranged overdraft?
This is an overdraft that you arrange with us in advance.
To get an arranged overdraft, you must be aged 18 or over and apply online, in a branch or on the telephone. We then run a few affordability checks and, if approved, we let you how much you can borrow.
Once approved, your overdraft will appear on your account immediately for existing customers and in a few days for customers new to TSB.
What are the benefits of an arranged overdraft?
Perfect for short-term borrowing
If you need to borrow a small amount of money for a short period of time, an overdraft may be cheaper than a personal loan or credit card.
Simple fees and charges
Our overdrafts provide an initial interest-free and fee-free overdraft amount. If you borrow more than this, it costs £6 per month plus interest on the additional amount.
You’re in control of your overdraft. You can ask to increase, decrease or cancel it at any time.
We’re aware that some people using Apple iOS devices may have an issue accessing the overdraft eligibility checker. While we work on an update, please use desktop view in your browser to access the checker.
How much does an overdraft cost?
Our overdraft cost calculator gives you an idea of how much an overdraft will cost you. The figures are based on the information you provide. We therefore recommend you use this calculator as a guide only because the actual cost may differ based on how you use the overdraft in real life.
Overdrafts are charged monthly and are shown on your current account statement. The cost depends on how much your bank account is overdrawn and is made up of a monthly overdraft usage fee plus any interest that may be charged. The table below sets out the arranged overdraft fees and charges until 2 April 2020.
Arranged overdraft fees and charges
Interest and fee-free amount
Year 1: £2,010
Year 2: £1,510
Year 3: £1,010
Monthly overdraft usage fee
Interest on this additional amount
1.52% per month
0.66% per month
1.30% per month
For information on overdrafts on our accounts that are no longer available to new customers, please visit either the Added Value or Other Accounts page.
From 2 April 2020 we will no longer charge daily or monthly fees for Arranged or Unarranged Overdrafts. Our overdraft rates will be a standard rate of 39.9% EAR*.
*EAR is the Equivalent Annual Rate. This is the actual rate of an overdraft. It doesn't take into account fees and charges. Arranged Overdrafts are available to UK residents only, over 18, subject to application and approval. Overdrafts are repayable on demand.
For more information about the changes to how we charge for Arranged and Unarranged Overdrafts on all of our accounts from 2 April 2020 please visit Changes to your Overdraft.
Full details of our fees and charges can be found in our Banking Charges Guide.
It’s up to you how much you pay back and when you make a payment. This is so long as you’re on top of managing your overdraft, such as staying within your arranged overdraft limit and making sure there are regular amounts of money coming into your account.
Overdrafts are charged monthly and the amount you pay back depends on how much you’re overdrawn by and the type of current account you have.
Once your application for an arranged overdraft has been approved, it will appear on your account immediately for existing customers and in a few days for customers new to TSB . You can check your overdraft limit in the mobile app, Internet Bank, Telephone Bank and in our local branches.
An unarranged overdraft is when you spend more money than you have in your account and in your arranged overdraft.
For example, you may try to make a Direct Debit payment and you don’t have enough money. If we agree, we'll provide you with an unarranged overdraft (or extend your existing one) to cover the payment. If we do not agree, you won't be able to make the payment (it will be refused due to a lack of funds).
Unarranged overdraft fees and charges
We'll never charge you more than £80 each monthly billing period.
£10 overdraft buffer.
You won't pay any fees or interest if you borrow £10 or less using an unarranged overdraft.
Monthly overdraft usage fee
£6 (unless you have already paid this by using an arranged overdraft)
Interest on the whole amount
1.52% per month
0.66% per month
1.30% per month
£5 per day if the unarranged overdraft is £10-£25.
£10 per day if the unarranged overdraft fee is £25 and over.
Maximum of 8 daily fees in a monthly billing period
Returned item fee
If you don't have enough money in your account to make a payment and we decline your request for an unarranged overdraft, you will not be able to make that payment.
Maximum of 3 per day.
For overdraft information on our accounts that are not available to new customers, please visit either the Added Value or Other Accounts pages.
We’ll never charge you more than £80 each monthly billing period for the total of all these fees:
Unarranged Overdraft Daily Usage Fees
Unarranged Monthly Overdraft Usage Fee
Unarranged Overdraft interest
Returned Item Fees
To make comparing bank products easier for you, banks are setting a maximum monthly charge for unarranged borrowing fees. Each bank may charge different fees, but all banks are explaining it the same way, with the same wording.
Monthly cap on unarranged overdraft charges
Each current account will set a monthly maximum charge for:
a) Going overdrawn when you have not arranged an overdraft.
b) Going over/past your arranged overdraft limit (if you have one).
This cap covers:
a) Interest and fees for going over/past your arranged overdraft limit.
b) Fees for each payment your bank allows despite lack of funds.
c) Fees for each payment your bank refuses due to lack of funds.
As well as easy access to your bank account balance and other information through cash machines, Internet and Mobile Banking, we offer specific services to help you avoid unnecessary overdraft charges:
£10 overdraft buffer. You won't pay any fees or interest if you borrow £10 or less using an unarranged overdraft
Grace period. You have until 10pm (UK time) to pay enough money into your account to avoid any overdraft fees and interest that we may charge that day
Retry periods. If you don’t have enough money in your account to make a payment, we’ll give you extra time to put money into it. For Direct Debits and cheques, we’ll try to take the payment shortly after midnight on the due date or next working day, and again after 2.30pm that same day. For standing orders and future dated payments, we’ll also try a third time shortly after midnight the next working day after we first tried to make the payment
Control. For £10 a month, you can stop your account from going into an unarranged overdraft and avoid overdraft fees and returned item fees. Add Control to your existing account by phone or at your nearest branch
We've changed the way your available balance is shown. On 12 January 2020, to comply with banking industry regulations we changed the way we calculate your available balance. It still takes into account any pending transactions, but no longer includes your arranged overdraft limit (if you have one). Your arranged overdraft limit and remaining overdraft will be shown on separate lines.
For example, if you have £50 in your account with a £200 arranged overdraft and you have a £80 debit card transaction pending, you'll see:
Available balance: -£30
Remaining overdraft: £170
Overdraft limit will always show £200
You'll see these changes on internet banking immediately, and in our mobile app within the next version available in the coming weeks.