Consumers ‘need to get smart’ to avoid overdraft charges

Not only will going into an overdraft have a negative impact on their finances, consumers may face further debt management problems via supplier charges, new figures reveal.

According to research conducted by moneysupermarket.com, those running up an unauthorised overdraft of £60 could face charges of up to £133 - a figure which could further exacerbate consumer difficulty in making personal loans repayments.

Head of savings Kevin Mountford said: "The message though is clear - be wary of breaching your authorised overdraft or face a nasty shock.

"People should get smart and take steps to avoid falling foul of their agreed overdraft by planning better where possible."

As a result, Mr Mountford advised those concerned about how such charges may affect their debt management to contact their financial provider to agree a temporary extension.

Figures released by financial charity Credit Action indicate that consumer borrowing via overdrafts, personal loans, credit cards and car and store finance products stood at £4,537 per adult as of the end of April.

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