Cost of setting up overdraft facility?

D

Dinarius

Registered User
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My overdraft facility with NIB is due for renewal.

As per usual, I received a letter a couple of weeks back asking for up to date accounts etc.... Since my accountant is currently auditing my accounts, I put this on the long finger. (I am currently way in credit and should be there for a while yet.)

I have just returned from four days away on business to find a letter saying that my new facility was in place and there would be a setup charge of €200 which will be debited from my account. Since I cannot access my online facility- NIB online is becoming Danske Bank online on the 18/04/06 and so is unavailable- I cannot see if the amount has been debited.

Either way, I think it is excessive and I want to consider my options.

1. If they have already debited it, can I ask for it back?

2. Is €200 excessive? I consider myself cast iron in credit terms.

Thanks.

D.
 
Can you clarify-this is a business account?

€200 would certainly be excessive for a personal account. I'm not sure what the norm is for business accounts.

I don't think the facility fee has much to do with your credit rating.
 
Strictly speaking, it's a personal account which I opened 20 years ago that I run my business through. I am a sole trader/sole operator.

D.
 
I do not ever in my life recall paying to set up an overdraft facility either in a business or personal account. If they ever tried it I would move banks.
 
If it is indeed a personal account, I would take my business elsewhere if I was charged €200 for an overdraft fee. It's around 10 times what I am charged by my bank.

Any chance that NIB are charging you as a business customer-which is strictly correct I guess.

At the very least, the charging process should comply with the Code Of Practice On Transparency In Credit Charges For Personal Customers (if it is a personal account). Detailed on the revamped, but still inadequate, [broken link removed].
 
woods said:
I do not ever in my life recall paying to set up an overdraft facility either in a business or personal account. If they ever tried it I would move banks.
Click to expand...

Who do you bank with? According to the [broken link removed] on current accounts, ptsb and UB are the only banks that do not charge overdraft renewal and set up fees.
 
Thanks for that. The implication appears to be that notification of any charges will be sent 10 working days before the charges are imposed.

Just read on AIB's site that there is no arrangement fee for a business overdraft.

I will be all over NIB like a cheap suit first thing on Tuesday morning.

Danske Bank can only be an improvement.

D.
 
CCOVICH said:
Who do you bank with? According to the [broken link removed] on current accounts, ptsb and UB are the only banks that do not charge overdraft renewal and set up fees.
Click to expand...
I am with AIB. I am going to check up on my statements because they could be hiding charges somewhere or calling them something else. I will report back.
 
woods said:
I am with AIB. I am going to check up on my statements because they could be hiding charges somewhere or calling them something else. I will report back.
Click to expand...

Please do! ;-)

Many thanks.

D.
 
Dinarius said:
Please do! ;-)

Many thanks.

D.
Click to expand...
I have a letter dated 15th March 2006 authorising an overdraft facility on a personal account. There is no mention of a set up fee and I have checked the account online and no fee has been taken since that date other than €11.50 which is listed as Quarterly fees to 24th March. I dont think that they can take it if they have not included it in the letter.
 
Spoke with NIB........

They said that the €200 was a 1% set up charge which they apply to all overdraft facilities - I wanted €20k.

I told them to wait! ;-)

D.
 
It certainly sounds like they are charging you business rates.

The rates/charges below are from their [broken link removed]


For accounts in existence prior to 18th April 2006:
• Current Account /Current Account Offset – Set up charge of 1%
to a maximum of €35, renewal fee of €20
• Student Account – no set up or renewal fee
• Principal /Principal Offset – set up free of charge up to €13,000.
Set up charge 1% to a maximum of €35 for limit in excess of
€13,000. Renewal fee of €20.​
* authorised overdraft not available on CashMaster, Freebank or Access package.​
Click to expand...

From their [broken link removed]


Arrangement and Renewal fees are subject to negotiation between the
Bank and the Borrower at a rate up to 1.75% of the sum borrowed.
Subject to credit assessment the following charges apply to overdraft
setup:
For Business Packages opened after 18th April 2006 the following
• Enterprise Arrangement &Renewal Fee Limit up to €15,000,
1%, thereafter negotiated up to 1.75%
• Enterprise Plus Arrangement & Renewal Fee Limit up to €25,000,
1%, thereafter negotiated up to 1.75%​
Click to expand...

If it's a business account, it seems they are charging as is outlined in the brochure.
 
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