One personal and business bank account provider has chosen to suspend its authorised overdraft interest charges for the next three months in order to give its customers some breathing room when it comes to debt racked up over the festive season.
In a move that could shake the halls of other high street bank branches, the Co-operative has decided to give customers with qualified overdrafts a bit of a break by not charging interest on any balances from now until 4 April. This could lead to savings of around £75 for a customer with an authorised overdraft of £2,000 on their current accounts during the grace period.
The new courtesy could spell much-needed relief to consumers facing the results of overspending this past Christmas season, said the Co-op’s banking head, Robin Taylor, who added that by providing its customers with a viable alternative to the “Big Five” high street lenders, the Co-operative seeks to inject some sorely-needed competition into the UK banking industry. Formal authorised overdrafts are covered under the new offer, including those provided by the Co-op’s smilemore, Privilege Premier, Privilege, and Current Account Plus accounts.
A formal overdraft, which can be set up by the Co-op with a £20 fee, lasts for a period of 12 months. Any debit balances from now until 4 April will not be subject to interest under the deal, though if your account is still overdrawn on 5 April, you will be charged interest going forward.