Welcome!

News Feed Item

Plan Ahead to Keep Down the Cost of Christmas

LONDON, UNITED KINGDOM -- (Marketwire) -- 12/13/12 -- With the festive season upon us and predictions of a bumper spend on loved ones(i), first direct suggests that customers who plan to use their overdraft to cover any additional spending, review their overdraft limit so it will cover their extra seasonal purchases.

Over a third of Brits have used their overdraft in the past 12 months(i) as it is a very cost effective way to borrow in the short term and this is set to rise as the Christmas cheer gets under way. However shoppers need to understand the cost of their borrowing. Even though first direct current account overdraft interest costs have stayed the same, on average the annual cost of being overdrawn by GBP 500 for 7 days every month has almost doubled in 5 years from GBP 18.94 in 2007 to GBP 40.08 in 2012. This for many would be an unnecessary extra cost to the festive bill.

Andy Forbes, Head of Products at first direct commented, 'An overdraft is a convenient way to borrow for short periods without having to arrange a specific loan. Arranging an adequate limit on your account means you know you have the flexibility to spend up to that amount.

'With our 1st Account there is no cost for setting up or changing your limit so it makes sense to request a limit appropriate to your needs. At first direct there is no interest charged if you keep your overdraft balance under GBP 250 and higher balances are charged at a competitive 15.9% EAR.'

Andrew Hagger from Moneycomms added, 'If you ask people how much it would cost them to use a GBP 500 authorised overdraft facility with their bank, many wouldn't have a clue. Unfortunately it's not until interest charges and fees are debited to their accounts that some people realise just how expensive it can be.

'Although daily fees may be seen as more transparent and easier to calculate, it can prove to be a very expensive way of borrowing, particularly for smaller sums. A bit of planning can make an overdraft a sensible way to manage the costs of the festive period.'


                           Sept 2007                  Annual cost of        
                                                      authorised GBP 500    
                                                      overdrawn balance for 
                                                      7 days every month    
Abbey                      16.9% EAR                  GBP 19.45             
Bank of Scotland           18.9% EAR                  GBP 21.75             
Barclays (Bank                                                              
Account)                   15.6% EAR                  GBP 17.95             
Clydesdale Bank                                                             
(Current account plus)     9.6% EAR                   GBP 11.05             
Co-operative Bank          19.5% EAR + GBP 15 per                           
(current)                  annum                      GBP 37.44             
First Direct               10.9% EAR                  GBP 12.54             
Halifax (Current)          18.9% EAR                  GBP 21.75             
HSBC bank Account          18.8% EAR                  GBP 21.63             
Lloyds TSB Classic         19.3% EAR                  GBP 22.21             
Nationwide Flex            7.75% EAR                  GBP 8.92              
NatWest - Current Plus     19.9% EAR                  GBP 22.90             
RBS - interest paying                                                       
current account            19.9% EAR                  GBP 22.90             
Smile                      11.9% EAR                  GBP 13.69             
Yorkshire bank -           9.6% EAR                   GBP 11.05             
Current Account Plus                                                        
Average 14 Accounts                                   GBP 18.94 per year    

                           Nov 2012                   Annual cost of        
                                                      authorised GBP 500    
                                                      overdrawn balance for 
                                                      7 days every month    
Santander - Everyday       GBP 1 per day (max GBP                           
Current                    20 per month)              GBP 84.00             
Bank of Scotland -                                    GBP 93.80 (first GBP  
classic                    19.94% + GBP 6 pm          25 interest free)     
Barclays (Bank                                                              
Account)                   19.3% EAR                  GBP 22.21             
Clydesdale Bank                                                             
(Current account plus)     18.85% EAR                 GBP 21.69             
Co-operative Bank          18.9% EAR + GBP 20 per     GBP 41.75             
(current)                  annum                                            
First Direct               15.9% EAR                  GBP 9.15 (first GBP   
                                                      250 interest free)    
Halifax (Current)          GBP 1 per day              GBP 84.00             
HSBC bank Account          19.9% EAR                  GBP 22.90             
Lloyds TSB Classic         19.94% EAR + GBP 6 pm      GBP 93.80 (first GBP  
                                                      25 interest free)     
Nationwide Flex            18.9% EAR                  GBP 21.75             
NatWest - select           19.89% EAR                 GBP 22.89             
RBS - Select               19.89% AER                 GBP 22.89             
Smile - Current            18.9% EAR                  GBP 21.75             
Yorkshire bank -                                                            
Current Account Plus       18.85% EAR                 GBP 21.69             
Average 14 Accounts                                   GBP 41.73 per year    

Research by Andrew Hagger - MoneyComms.co.uk -22 November 2012

(i)Research by Moneysupermarket

Information about first direct:


--  Winner of Which? Best Financial Provider and Moneywise Most Trusted
    Financial Provider 3 years running 
--  Top financial institution in the Which? Customer Satisfaction Survey
    with an all-time high of 93% 
--  Ranked first in the Retail Banking Satisfaction Study by JD Power &
    Associates for two years running

first direct provides both telephone banking and online banking services to its 1.2m customers. It offers a full range of personal banking products including its award winning Current Account and offset mortgages.

For the latest updates, visit the first direct Newsroom or follow us on Twitter.

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
IoT is rapidly changing the way enterprises are using data to improve business decision-making. In order to derive business value, organizations must unlock insights from the data gathered and then act on these. In their session at @ThingsExpo, Eric Hoffman, Vice President at EastBanc Technologies, and Peter Shashkin, Head of Development Department at EastBanc Technologies, discussed how one organization leveraged IoT, cloud technology and data analysis to improve customer experiences and effici...
"We are an all-flash array storage provider but our focus has been on VM-aware storage specifically for virtualized applications," stated Dhiraj Sehgal of Tintri in this SYS-CON.tv interview at 19th Cloud Expo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Fact is, enterprises have significant legacy voice infrastructure that’s costly to replace with pure IP solutions. How can we bring this analog infrastructure into our shiny new cloud applications? There are proven methods to bind both legacy voice applications and traditional PSTN audio into cloud-based applications and services at a carrier scale. Some of the most successful implementations leverage WebRTC, WebSockets, SIP and other open source technologies. In his session at @ThingsExpo, Da...
The cloud competition for database hosts is fierce. How do you evaluate a cloud provider for your database platform? In his session at 18th Cloud Expo, Chris Presley, a Solutions Architect at Pythian, gave users a checklist of considerations when choosing a provider. Chris Presley is a Solutions Architect at Pythian. He loves order – making him a premier Microsoft SQL Server expert. Not only has he programmed and administered SQL Server, but he has also shared his expertise and passion with b...
"IoT is going to be a huge industry with a lot of value for end users, for industries, for consumers, for manufacturers. How can we use cloud to effectively manage IoT applications," stated Ian Khan, Innovation & Marketing Manager at Solgeniakhela, in this SYS-CON.tv interview at @ThingsExpo, held November 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA.
As data explodes in quantity, importance and from new sources, the need for managing and protecting data residing across physical, virtual, and cloud environments grow with it. Managing data includes protecting it, indexing and classifying it for true, long-term management, compliance and E-Discovery. Commvault can ensure this with a single pane of glass solution – whether in a private cloud, a Service Provider delivered public cloud or a hybrid cloud environment – across the heterogeneous enter...
Without a clear strategy for cost control and an architecture designed with cloud services in mind, costs and operational performance can quickly get out of control. To avoid multiple architectural redesigns requires extensive thought and planning. Boundary (now part of BMC) launched a new public-facing multi-tenant high resolution monitoring service on Amazon AWS two years ago, facing challenges and learning best practices in the early days of the new service. In his session at 19th Cloud Exp...
The cloud promises new levels of agility and cost-savings for Big Data, data warehousing and analytics. But it’s challenging to understand all the options – from IaaS and PaaS to newer services like HaaS (Hadoop as a Service) and BDaaS (Big Data as a Service). In her session at @BigDataExpo at @ThingsExpo, Hannah Smalltree, a director at Cazena, provided an educational overview of emerging “as-a-service” options for Big Data in the cloud. This is critical background for IT and data professionals...
Today we can collect lots and lots of performance data. We build beautiful dashboards and even have fancy query languages to access and transform the data. Still performance data is a secret language only a couple of people understand. The more business becomes digital the more stakeholders are interested in this data including how it relates to business. Some of these people have never used a monitoring tool before. They have a question on their mind like “How is my application doing” but no id...
@GonzalezCarmen has been ranked the Number One Influencer and @ThingsExpo has been named the Number One Brand in the “M2M 2016: Top 100 Influencers and Brands” by Onalytica. Onalytica analyzed tweets over the last 6 months mentioning the keywords M2M OR “Machine to Machine.” They then identified the top 100 most influential brands and individuals leading the discussion on Twitter.
What happens when the different parts of a vehicle become smarter than the vehicle itself? As we move toward the era of smart everything, hundreds of entities in a vehicle that communicate with each other, the vehicle and external systems create a need for identity orchestration so that all entities work as a conglomerate. Much like an orchestra without a conductor, without the ability to secure, control, and connect the link between a vehicle’s head unit, devices, and systems and to manage the ...
More and more brands have jumped on the IoT bandwagon. We have an excess of wearables – activity trackers, smartwatches, smart glasses and sneakers, and more that track seemingly endless datapoints. However, most consumers have no idea what “IoT” means. Creating more wearables that track data shouldn't be the aim of brands; delivering meaningful, tangible relevance to their users should be. We're in a period in which the IoT pendulum is still swinging. Initially, it swung toward "smart for smar...
In an era of historic innovation fueled by unprecedented access to data and technology, the low cost and risk of entering new markets has leveled the playing field for business. Today, any ambitious innovator can easily introduce a new application or product that can reinvent business models and transform the client experience. In their Day 2 Keynote at 19th Cloud Expo, Mercer Rowe, IBM Vice President of Strategic Alliances, and Raejeanne Skillern, Intel Vice President of Data Center Group and G...
"We are a modern development application platform and we have a suite of products that allow you to application release automation, we do version control, and we do application life cycle management," explained Flint Brenton, CEO of CollabNet, in this SYS-CON.tv interview at DevOps at 19th Cloud Expo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Information technology is an industry that has always experienced change, and the dramatic change sweeping across the industry today could not be truthfully described as the first time we've seen such widespread change impacting customer investments. However, the rate of the change, and the potential outcomes from today's digital transformation has the distinct potential to separate the industry into two camps: Organizations that see the change coming, embrace it, and successful leverage it; and...