Danske Overdrafts

Whether you have an unexpected bill to pay or would like a little breathing space when you need it, an arranged overdraft could keep you covered.

Important information about overdrafts

We are making changes to our overdraft fees and service charges from 1 April 2020.

Please read all the Changes to the cost of banking with us documentation.

You can also compare the cost of arranged overdrafts today and what they’ll be after 1 April.

You can also have a look at some FAQs.


Overdrafts are not available on Danske Discovery or Standard accounts.

An overdraft is a form of short-term borrowing, a safety net that allows your balance to dip below zero if you don’t have enough in your account to meet an unexpected payment. Another way to borrow in the short term is a credit card, but if you need to borrow money over the longer term, a personal loan may be more suitable.

There are two types of overdraft – arranged and unarranged.

As the name suggests – an arranged overdraft has been pre-agreed with us up to a set limit, giving you peace of mind that you'll be able to make unexpected payments or get money in an emergency. You can borrow from it any time, as long as you stay within your limit. There may be costs to pay with an arranged overdraft.

An unarranged overdraft is when your account balance either goes overdrawn without an arranged overdraft in place, or goes beyond your arranged overdraft limit. When this happens, we'll look at your circumstances when we're deciding whether to allow any further payments from your account. There may be costs to pay with an unarranged overdraft.


Some of the risks of having an overdraft

We can ask you to repay your overdraft in full at any time.

If you rely on your overdraft, even an arranged one, it may have a negative effect on your credit file and your ability to borrow money in the future.

If you try to make a payment from your account and you don’t have enough money:

  • The payment may be declined which could have other consequences, for example if you don't make a car insurance payment on time, you may not be insured to drive.
  • The company to which you pay the Direct Debit might also try to take it again before you’ve had a chance to lodge money into your account.
  • You may be charged fees.

Overdraft cost calculator

You can use our cost calculator to give you an idea of how much a Danske overdraft could cost you, or how much going over your overdraft could cost.

Calculate your cost

Eligibility tool

Check how likely you are to be offered an overdraft on a personal current account

  • It won't affect your credit rating
  • Fill in your details and get a response before you apply

Check your eligibility

How to request an arranged overdraft

You can apply for an overdraft at the same time you’re opening a new current account – online, in branch, or on the phone.

If you want to add an overdraft to a current account you already have you can also apply on eBanking, or if you want to increase your existing overdraft you can apply in branch or on the phone.

Danske Prestige and Principal account holders should contact their Relationship Manager to discuss any overdraft requirements they may have.

Keeping an eye on your balance

Overdraft alerts can help you manage your account and may also help you avoid charges. If you give us your mobile number we'll automatically register you to get text alerts when you go into arranged or unarranged overdraft.

The arranged overdraft text will tell you when you have started to use the overdraft and help you monitor your arranged overdraft use.

The unarranged overdraft text will tell you when you go overdrawn, for example when a payment leaves your account and you don't have enough funds to cover it. It will also tell you how much you need to pay into your account and by what time, helping you stay in control of your finances.

If you change your mind later and want to stop getting these texts, or if you didn't give us your number and you want to start getting them, please contact us.

You can also ask us to text or email you when your account balance falls below a certain amount. You can sign up for this in eBanking, under ‘Mobile Services' then ‘Account balance service’.

Reducing an overdraft

If you think your overdraft is more than you need, or if you want to remove it from your account, contact your branch or phone 0345 602 2998

If you wish to cancel your overdraft, you’ll need to repay any amount you have borrowed first.

How we display your balance if you have an overdraft

It’s important to know when you’re spending your own money and when you’re using your overdraft.

That’s why, when you check your balance at our cash machines or online, any remaining overdraft will be shown separately from your account’s available balance.

Changes to your overdraft balance.

Overdraft costs

Rates correct as at 20 March 2020.

EAR stands for ‘effective annual rate’ and is used to show the costs of borrowing after considering the interest rate and how often it is charged to the account. It does not include any fees or service charges relating to overdrafts.

The arranged overdraft interest rate is made up of two parts-the Bank of England Bank Rate (BOEBR) and an amount over the BOEBR (known as the 'margin'), which are both variable rates. We set the margin on an arranged overdraft. When the Bank of England Bank Rate changes, we change the rate at the beginning of the next business day after the Bank of England announces the change. We will give you two months' written notice before we increase the margin that applies to your account.

Monthly cap on unarranged overdraft charges

  1. Each current account will set a monthly maximum charge for:
    1. going overdrawn when you have not arranged an overdraft; or
    2. going over/past your arranged overdraft limit (if you have one)
  2. This cap covers any:
    1. interest and fees for going over/past your arranged overdraft limit;
    2. fees for each payment your bank allows despite lack of funds; and
    3. fees for each payment your bank refuses due to lack of funds

Each calendar month we will charge a maximum of three fees and service charges for using, or trying to use, an unarranged overdraft. We will charge any paid transaction or unpaid transaction fees first, up to the value of the monthly cap. If the total of these fees does not already meet the monthly cap, we will apply the unarranged overdraft usage fee if appropriate.


Important information

If you do not understand any point and want to find out more, please contact us on 0800 660 033.

FAQs

  • Why have you increased our arranged overdraft interest rates?

    The new FCA regulations allow banks to only charge customers an interest rate for overdrafts – fixed fees and daily charging structures are not allowed under the new rules. All banks are reviewing their overdraft charging structures as a result of the new rules.

    For most customers, a single percentage rate will make it easier to calculate the cost of an overdraft, rather than the range of additional fixed charges that exist at the minute. For the majority of our overdraft customers, this is good news as the cost of borrowing for their overdraft will remain the same or decrease.

  • With the removal of the £12 fee, will I be better off?

    This will depend on a number of factors such as what type of account you have, how much of an overdraft you borrow and how long you borrow for. See the examples to give you an idea of how the cost of borrowing from your overdraft may change.

  • Why is the interest rate different to the EAR?

    EAR stands for ‘effective annual rate’ and is used to show the costs of borrowing after taking into account how often interest is charged to the account and compounded. It does not include any fees or service charges.

  • How much will this cost me?

    See the examples to give you an idea of how the cost of borrowing from your overdraft may change.

    You can refer to the overdraft cost calculator on our website for changes from 1 April 2020.

  • What are my options?

    We understand that you may be unhappy with some of these changes. Please review your account to make sure it’s still the best option for you. If you have any questions, please either visit your local branch or call us.

    • If you accept these changes, you don’t have to do anything.
    • You can move to another of our current accounts - see our personal current account webpage to compare them.
    • You can switch to a current account with a different bank.
    • You can ask us to close your account.

Interested in arranging an overdraft?

New customer

Apply for an overdraft at the same time you open your new current account.

Cash Reward account
Choice account
Freedom account

Already got a Danske personal current account?

Apply for a new overdraft in branch, on the phone or using eBanking.

Log on to eBanking