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Overdraft
- Thread starter frontosa
- Start date
Bar0n
Executive Member
- Joined
- Nov 12, 2010
- Messages
- 5,552
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- 7
If you have no money in your account, any additional funds will be withdrawn from your overdraft and your account will have a negative balance.
Mike Hoxbig
Honorary Master
No you can't use an overdraft without using up all your available funds in the account. If you want to do that then rather get a credit card.
No, your positive balance will be depleted first, before using your over draft.
member2204
Senior Member
And remember that you get charged for having a OD facility. I know Standard Bank charged thirty odd Rand, even if you don't use it.
Dunno if they still charge or how much it is now.
Dunno if they still charge or how much it is now.
Mier
Expert Member
Available balance = Positive Balance + Overdraft Limit
DON'T EVER USE IT - CANCEL THE FACILITY IMMEDIATELY
You WILL thank me. Once you get caught up in the convenience of using it, it's VERY difficult to get out of it.
I know a few people that, when their salary get paid, it hardly covers the OD. The result is that they have to use the OD again, just to survive. The banks charge huge interest once you dip into it. I too once lived like this. Finally, I took out a personal loan (at lower interest than OD), paid off the OD and cancelled the facility - Best decision ever.
I know it's tempting, but OD is from the devil.
DON'T EVER USE IT - CANCEL THE FACILITY IMMEDIATELY
You WILL thank me. Once you get caught up in the convenience of using it, it's VERY difficult to get out of it.
I know a few people that, when their salary get paid, it hardly covers the OD. The result is that they have to use the OD again, just to survive. The banks charge huge interest once you dip into it. I too once lived like this. Finally, I took out a personal loan (at lower interest than OD), paid off the OD and cancelled the facility - Best decision ever.
I know it's tempting, but OD is from the devil.
+10000!
Kloofvreter
Honorary Master
Velenoso
Expert Member
Guys, use OD and Credit Cards wisely. Don't spend the entire facility and use it as another account. Not what they're for.
freemilo
Active Member
The trick is to not use a credit facility to buy things you couldn't afford otherwise.
I can recommend the Virgin Credit Card = no monthly fees, no transaction fees, 30 days interest free - This is a great service to save money and build a good credit record. I use it for all my transactions during the month, at the end of the month I settle the balance. Doesn't' cost me a cent in charges or interest where if I used my standard bank debit card I would pay for every swipe.
I can recommend the Virgin Credit Card = no monthly fees, no transaction fees, 30 days interest free - This is a great service to save money and build a good credit record. I use it for all my transactions during the month, at the end of the month I settle the balance. Doesn't' cost me a cent in charges or interest where if I used my standard bank debit card I would pay for every swipe.
The original intention of an overdraft was not for private clients, but for business who might have an opportunity to acquire stock at a good price, or to buy the assets of a competitor, in short to facilitate trade and industry. The banks however, became ever more greedy, and with rising wages of the middle class, saw an opportunity to make more money by granting overdraft facilities to private clients, who often did not need this facility which is in any case well served by credit cards. Their interest on the overdraft facility was pitched at a few percentage points above the house loan market but below the credit card late payment rate.
Then (and without asking me) they instituted a "facility fee" which means I have to pay R 15,00 a month in order to have the overdraft facility, which in 43 years of banking with the same bank, I have never used. On trying to cancel this, I was told that it was a standard requirement of the "Corporate account" which is the label I have had applied to my business account by the bank, without even asking for it. Now, I see that over and above the facility fee, there is another fee for the purpose of being able to use the proceeds of a cheque without waiting the requisite 7 days for the cheque to clear. I am also told that there will soon be an additional handling fee for cheque deposits.
On learning all this, I went along to Capitec Bank and opened an account there. All fees are clearly laid out, internet payments have a fixed fee (my bank's internet payment structure gradually increased to a maximum of R 27,50 per transaction). So bye-bye big bank. No more R 1000 fees for a few simple transactions - paying a few bills to Council, telephone, wages, etc
Then (and without asking me) they instituted a "facility fee" which means I have to pay R 15,00 a month in order to have the overdraft facility, which in 43 years of banking with the same bank, I have never used. On trying to cancel this, I was told that it was a standard requirement of the "Corporate account" which is the label I have had applied to my business account by the bank, without even asking for it. Now, I see that over and above the facility fee, there is another fee for the purpose of being able to use the proceeds of a cheque without waiting the requisite 7 days for the cheque to clear. I am also told that there will soon be an additional handling fee for cheque deposits.
On learning all this, I went along to Capitec Bank and opened an account there. All fees are clearly laid out, internet payments have a fixed fee (my bank's internet payment structure gradually increased to a maximum of R 27,50 per transaction). So bye-bye big bank. No more R 1000 fees for a few simple transactions - paying a few bills to Council, telephone, wages, etc
freemilo
Active Member
Capitec Bank is making waves, I've been hearing alot of good things about them.