What is your overdraft interest rate?
While the vast majority of people in the UK will have some form of overdraft facility how many are aware of the interest rate currently being charged on any outstanding balances?
A report today confirms that the average rate charged by banks and building sites in the UK during the month of August was a phenomenal 19.1% which is the highest figure since records began in 1995. As more and more people struggle to stretch their monthly income to cover bills and necessities there is no doubt that more and more money is now being spent on financing debt.
This significant increase in overdraft interest rates does not appear to have happened overnight and it actually feels as though it has crept up on us. However, if you have an overdraft facility of £1000 which is being utilized on a monthly basis then you will be paying nearly £200 in interest charges. The days of the fee free and interest-free overdraft now appear to have fallen by the wayside and many banks and building societies have pulled their more attractive offers and increased rates across the board.
UK consumers and UK businesses are now being squeezed from all sides and seeing their disposable income reducing on a monthly basis.
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