New Lloyds TSB Overdraft Fees Will Cost More For Some
Published: 24 June 2010
By MoneyHighStreet Staff 31 Comments
Updated: 24 June 2010
Lloyds TSB recently announced that from December it will be changing its overdraft fees but whilst good for some, for those who go into their authorised overdraft limit it will cost more.
The new overdraft fees from Lloyds TSB will be introduced on 2 December and will cover both existing and new personal current account customers.
The current Monthly Unplanned Overdraft fee of £15 is being removed.
However customers will pay a £5 Monthly Overdraft usage fee if they use their unplanned or planned overdraft. This fee is on top of the monthly interest already charged, albeit only one such usage fee will be payable in any one monthly billing period.
As Andrew Hagger of Moneynet.co.uk comments “We have seen a number of high street providers reduce unauthorised borrowing costs which is not surprising given the government focus on ‘unfair’ charges; however it’s worrying that authorised borrowers are now being targeted with increased costs, particularly so if other providers follow the moves from Halifax and Lloyds TSB.”
Customers will perhaps more carefully need to manage their money over the month given these changes. Importantly current account holder need to check the small print and make sure they select an account that best suits their needs otherwsie the risk is ending up paying out on unnecessary costs.
The following are authorised overdraft borrowing examples, according to information from moneynet.co.uk.
| Tariff | Cost of authorised £500 overdrawn balance for full month | |
| Alliance & Leicester | 50p per day max £5 per month | £5.00 |
| Santander | Interest 12.9% | £5.37 |
| First Direct | Interest 15.9% | £6.62 |
| Nationwide BS | Interest 18.9% | £7.88 |
| RBS/NatWest | Interest 19.24% | £8.02 |
| Lloyds TSB Now | Interest 19.3% | £8.04 |
| Barclays | Interest 19.3% | £8.04 |
| HSBC | Interest 19.9% | £8.29 |
| Lloyds TSB from 2 December | Interest 19.3% plus £5 monthly fee | £13.04 |
| Halifax | £1 per day up to £2500 and £2 per day over this | £25.00 Net (£30.00 less £5 monthly credit) |
| Tariff | Cost of authorised £500 overdrawn balance for 3 days | |
| Halifax | £1 per day up to £2500 and £2 per day over this | £2 credit Net (£5 monthly credit less 3 x £1 daily charge) |
| Santander | Interest 12.9% | £0.53 |
| First Direct | Interest 15.9% | £0.65 |
| Nationwide BS | Interest 18.9% | £0.78 |
| Lloyds TSB Now | Interest 19.3% | £0.79 |
| RBS/NatWest | Interest 19.24% | £0.79 |
| Barclays | Interest 19.3% | £0.79 |
| HSBC | Interest 19.9% | £0.82 |
| Alliance & Leicester | 50p per day max £5 per month | £1.50 |
| Lloyds TSB from 2 December | Interest 19.3% plus £5 monthly fee | £5.79 |
It is a disgrace..
I have been with LLoyds for 32 years..
I fundamentally object to this form of bank charge.. for an overdraft use of £5 the cost is £5 Am I alone is seeing this as a 100% interest per month?
We the tax payer re-capitalise the banks.
The government say the banks have to hold more capital and turna blind eye to the banks de-coupling any sense of resonableness between interest on savings and interest on borrowing in order to accomplish this.
The banks (again) see an opportunity to tear the arse out of it, and introduce schemes like this to accellarate the process. It is small wonder that they hava all now returned to profit.
Does anyone suppose that these “emergency” measures will be retired when the banks cofferes are full? Not on yer nelly.
I shall be leaving LLoyds, but hold no real expectation that this strategy will not follow me as other banks get on the gravy train.
I will also be leaving Lloyds-TSB, as a direct result of these charges, a bank I have been with for 16 years. Why even bother arranging an overdraft facility when the cost is the same?
Meanwhile, they are also reducing the interest rate on current accounts from 0.1% to zero.
They want to charge 19.9% plus £5 a month for an overdraft and offer absolutely nothing for credit?
Billions of pounds of taxpayers money were poured into this bank and all we seem to get in return is disregard for customers and a deficit which is set to ruin lives and plunge us back into recession.
Money well spent?
This is an absolute disgrace. I have been with TSB for over 20 years now and I will be changing banks. Not that it will do me any good though as ALL the banks are on it. Christ, how much more money do these people need to make for not even doing anything in return. It makes my blood boil that they are allowed to get away with it. When these banks go through the next phase of melt down (and it will happen) we should let them rot in hell!!!!! Very disgruntled LOYAL customer Steve.
been with TSB for over 45 years not any more, as soon as I can pay off my overdraft i’m packing in with banks full stop. rich get richer ect’
I’ve been with TSB since the early 90′s, this is the stupidest change I have seen them make!
I’ve gone into my overdraft before, never got more than a couple of quid interest (£30+ etc), this time, I went just £16 overdrawn, for less than a quater of a day and I received the new £5 Monthly Overdraft Usage Fee charge. If I had gone over my agreed overdraft limit of £100, I would expect to pay something like that, but for overdrawing £80 under my agreed limit and for less than a quater of a day, such a charge is unacceptable.
After I have made changes at my work payment scheme, I will be closing my Lloyds TSB account, forever!
Another very disgruntaled customer, David!
I am another LOYAL and very disgruntled Lloyds TSB customer, I have been with Lloyds TSB since i was old enough to open an account and unfortunately do not have the funds to clear my overdraft right now so whether i like it or not i will be shafted for an extra £5 every month on top of the interest i pay on my agreed overdraft until such time as i can pay it off in full and close my account.
There is absolutely nothing i can do about it! Great.
Thank you very much Lloyds TSB for taking yet more of my money at a time when i’m trying to pay it off!
And thanks also for no help whatsoever every time i have requested a monthly reduction in my agreed overdraft!
This country is getting worse, it’s almost intolerable it’s no wonder so many people are jumping ship.
people were pre-notified about these charges.
at least lloyds have have reduced there unauthorised borrowing charges and introduced a 10 pound buffer.
they also offer AVA a/c’s which help offer interest and fee free components.
i.e, premier a/c 500 quid.
whats the point changing banks.
its something thats going to be introduced in other banks sooner or later and at least it gives an incentive to stop living in your overdraft.
We are closing our lloyds accounts ( .87p overdraft interest + £5.00 usage !!!! ) we are going to Credit Union which is a not for profit banking system, that now offers all the facilities of a normal bank.
I went to my lloyds bank today and advised them that I was shortly closing my account after 34 years.
The reason being that I object to a flat rate £5 charge for being forgetfully o/d by about £50 for one night,pointing out that I am paying for those that are overdrawn any number of nights in a month and only pay the same flat rate. I am normally very very rarely o/drawn and have never been o/drawn for more than a couple of days in 34 years. Obviously because of that they have not made enough out of me over the years. Essentially they didn’t give a dam !!!
This is a rip off thanks tsb I’ll be clearing my overdraft asap you are not getting another bloody penny
What a scam ! , I am appalled at Lloyds TSB
Yes i am one of the many to be stung by there so called “agreed”overdraft charge for going a few quid overdrawn after christmas . We the taxpayers saved these banks ,and this is the thanks we get ?
Enjoy your bonuses you greedy c**** , you f****** deserve them.
I went £13 OD for one day and have been charged this. I am currently out of work, and budgeting to the last penny…so today I am switching banks to NATWEST. I have all my savings etc with Lloyds but it will all be going! This is just an outragous charge and out of proportion. I wouldn’t mind if it was £100 or £1000 but £13 for a day just isnt right. I have online banking and kept clearing my overdraft so I AM VERY ANNOYED! Today is the last day I am a Lloyds customer.
I called TSB when I saw the charge on my online account.The advisor had the audacity to tell me it was ONLY £5 pounds to which I asked him to multiply that by the 12 months ..silence on the other end of the phone.
After been made redundant last year (back to work now) I am always on my agreed overdraft so this means I will continue to give TSB my hard earned £5 every month not forgetting the£7.95 I pay to run the silver account and £10.99 overdraft interest fee.I didn’t mind paying the other two but is the Usage Feereally necessary??
If I can clear that overdraft I will be closing my account asap I went as far as reminding the advisor that TSB don’t seem to care for their customers anymore.It is appaling that TSB is making sure they make money from their customers what an an absolute disgrace !!
why are you getting charged over £10 for your silver account, mine is only £7.95….x
sorry yeah just read it properly x
I agree Ive been a customer for 50 years and have just been persuaded to upgrade to a premier account when I looked at my statement and saw an extra £5 for using my overdraft I thought it was a mistake but no it was’nt, i think they are taking the piss. I shall be switching to santander as soon as I can. Unfortunately customer loyalty is a thing of the past
i,m always using my overdraft i pay £25 per month to be a premier customer in total i,m paying approx £50-£60 per month now including the useage fee and interest i will have to rethink which bank to use even though ive been with lloyds for about 30 years so much for loyalty
I’ve banked with Lloyds for 32 years and have quite a bit of money going in and out of my account monthly, have a £3k overdraft facility, and tend to dip into it a few times a year when payments going in from tenants are delayed by the odd day (didn’t get to the bank in time etc). As I handle quite a few tenants, I don’t mind paying daily interest on the odd day it dips into the overdraft facility – on other occasions I leave £2-3,000 in my account without bothering to move it around – a fair backscratcher with the bank – they earn interest when its in and I pay a little when I go over. It saves me having to check my account or run into town to put the odd £50 in in cash to cover a day!!
Following the new £5 charge for going into an overdraft (which is agreed), I am disgusted. They will be losing my business to Nat West, who I also have an account with, who like me as a customer and treat me with a bit of respect. They appreciate they have my money most of the time. Bad luck Lloyds – YOUR LOSS
I have been banking with LloydsTSB for over 10 years and am an ex employee of theirs.
I have a 3k arranged OD.
Monthly charges now include:
£17 account fee for platinum
£10 average interest charge
£5 overdraft usage fee (tipping point!)
Account Closed.
Just seen this charge on my statement, knew they’d changed the ‘rules’ but really thought it was for exceeding your overdraft limit and helping to reduce excessive bank charges due to bad press with banks all round! Not for actually dipping into it by a few quid. Been with the TSB since birth, now in excess of 42yrs. NO MORE! Am out tomorrow shopping for a new bank account. Why the hell should i want to pay towards those without overdrafts, those that have exceeded their overdrafts and bankers excessive bonuses! To hell with them and am pretty sure i will find a better deal on the highstreet,! Bet the guy who thought this up walked away with a couple of million the *unprintable curse*!
Am in the process of changing my bank account to first direct who offer a free £250 o/d and are charges interest after that. This suits me fine as I only tend to use my o/d on the odd occasion. 15 years of loyal banking with tsb means nothing. Already £15 down with these charges.
Goodbye it looks likes theres going to be a mass exodus from tsb of good reliable customers. Bad business sense in my book. Have found the process of switching to first direct excellent and easy and was given £100 for switching and most of all I can talk to real people no navigating through 1000s of different options.
Have been a Lloyds customer for 20 odd years. I’ve always avoided getting into debt (never had a credit card, payed off my student loans within 2 years and so on). I do however have a £200 agreed overdraft with Lloyds that I dip into fairly regularly. These new charges have encouraged me to finally pay this off, which, in truth, is probably a good thing.
However, i’m unhappy with the way Lloyds have gone about making these changes. I already have a Co-op and Post Office account and was already considering how to simplify my banking. This has given me the excuse I needed and I will be transferring all my daily affairs to the Co-op and closing my Lloyds account.
I have been with Lloyds TSB since when I was a University Student. Over 15 years I would say. This £5 usage fee will make me change bank to HSBC soon. I told them on the phone and said in a few years time client will be able to claim this back. I am sure not legal. Suddenly change the terms & condition before Christmas when they know everyone will have a little overdraft during Christmas. Rip off their long term customers, may be Lloyds got too many customers. Whoever thought of this idea should be sack and put on newspaper so that he/she will never get a job in the UK.
I live in Australia and like many on this site I have had a Lloyds TSB for over 30 years.
These new charges are a disgrace and completely unfair, very unhappy customer.
Good bye Lloyds TSB!
I have just got off the phone after spending a hour talking to various Agents of Lloyds TSB. Their justification for adding this additional £5.00 p.m. charge is non-sensical. We are being double charged for having a facility that banks use to make money.
Is it purely incompetent management on the part of Lloyds or, the threat posed by shareholders or just pure greed?
We need an action, a force to come together to fight this lunacy.
All those in favour say ‘Aye’ and we will start the ball rolling.
Aye.
This is a complete scam.
I completely disagree with Bob’s “…whats the point in changing banks. Its something thats going to be introduced in other banks sooner or later…”.
If enough people put their foot down and move banks it will convince other bank’s that they can’t ride rough shod over their retail customers.
Matt
Matt
I am furious. I opened a graduate account thinking that I would get ‘an interest and fee free overdraft’ clearly stated on the website and was left lumbered with this charge AFTER I had opened the account. I felt scammed and lied to. The advisor didn’t even go through the terms and conditions with me and never gave me any option to consider whether I would like the stupid monthly usage fee. I will definitely not be using the overdraft facility and transferring to another account.
Giselle
As with everyone else, really annoyed with Lloyds TSB and these charges, just rang up but they said they couldn’t do anything regarding them. Also i’m on paperless statements and don’t remember being told about the charges, seems my banks keep changing the goalposts with out informing me.
The also didn’t seem that worried when I said that I wanted to close the account, just that i’d have to go to a branch. Given the £5 per month plus one of the highest O/D interest rates at 19.3%!! Can’t understand why anyone would want to bank with them, i’m closing my accounts and moving to another bank asap.
Obviously they still don’t understand that to be a strong and lasting company they should treat their customers with at least some respect.
I have been with them since I was about 8yrs of age (when it was TSB) so over 35 years and I also used to work for them. They have been good to me over the years and I have kept within the limits of any planned overdrafts/loans. However, I also object to being charged both a monthly fee and interest on a planned overdraft. I expect to pay some form of interest for using an overdraft when staying within my limit but not also an extra monthly fee. I rang a few months ago to say I was unhappy and that I was thinking of leaving but no-one seem bothered. Now that I am moving my accounts to First Direct where I get a better deal, Lloyds TSB have tried to keep me form going by offering £200 of store vouchers but I said it was too late and it’s the principal of this monthly fee that bugs me. They said that all banks will be doing the same within one year but I’m happy to still move banks and wait until that happens. I feel sorry for the staff in the local branches as it’s not their fault this fee has been imposed but it’s the fat cats who want to make more profit for their fat bonuses.
i too have incurred these overdraft usage fee’s.i have been a customer since i was 8, now nearly 20 yrs on i have never been out of my overdraft limit.this is how they repay their customers.ths is just another way for them to make money, instead of just charging the ppl who go over their overdraft, nearly every person is paying £5 a month.probably 60x the amount in charges back to the back now…they should do away with bank charges altogether.we pay enough tax and charges these days without having to incur more.what makes it worse is you need a bank account to get your benefits into…i reckon they’re all in it on this 1!!!
I’m with Rob Walter on this, as well as all the other aggrieved customers of Lloyds TSB.
If Rob has a good idea of how to progress, I would love to hear it. Otherwise EVERYONE should write to the Banking Ombudsman with their complaints, (but find out about the procedure first, your complaint should follow a formal complaint to the bank).
If that gets nowhere, which is to be expected, then maybe it should be followed up by letters to MP’s.
Somebody should be brought to book about this, it’s close to being illegal in my opinion.