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An overdraft is a facility on your current account intended for short term borrowing. When your balance goes below £0, you enter an overdraft. The overdrawn amount will usually be subject to debit interest and you will be charged for entering into an unarranged overdraft.

You can check if you have an existing overdraft on your account and how much that is in online banking, the mobile app or on your statement.

To use our overdraft services you must be aged 18 or over. Overdrafts are offered subject to status.

Please note there are important changes to our Account Charges and Terms and Conditions which take place from April 2020. These include an increase to our Overdraft Annual Interest Rate and the removal of fees for unarranged overdrafts. Please read our Summary of Changes for more information.


An overdraft is a facility on your current account designed for short term borrowing. When your balance goes below £0, you enter an overdraft. You can request our overdraft services either on an arranged or unarranged basis.

We would always encourage you to request our overdraft services on an arranged rather than unarranged basis.

Arranged overdraft

An arranged overdraft is a set amount you’ve agreed with us in advance. There are no charges for an arranged overdraft but you’ll pay interest. The interest rate is variable, which means it can change over time. Should there be any changes to our interest rates we will communicate them to you in advance.

You’ll go into an unarranged overdraft if you go over your arranged limit or your account balance falls below £0 without an arranged overdraft in place.

You can request our overdraft services in advance and if we agree to your request (by agreeing an overdraft limit, or an increase to an existing overdraft limit) we will tell you your overdraft limit and confirm the terms in writing. An arranged overdraft lasts for 12 months and we will write to you towards the end of this period with information about what we may be prepared to offer you when your current overdraft expires.

An unarranged overdraft

An unarranged overdraft is what happens if you spend more than you have in your account, or go over your agreed limit on your arranged overdraft. You will be charged for entering into an unarranged overdraft and you will pay debit interest on whatever you go overdrawn by.

Your payments might also be refused if you try to go over your overdraft limit or you try to go overdrawn without an arranged overdraft. Any type of borrowing shows on your credit file. However, an unarranged overdraft shows as arrears, which can negatively impact your credit file and may make it harder for you to obtain credit in the future.

How you'll be charged when you use an overdraft

When you use an overdraft, you will be charged:

  • interest on the amount you are overdrawn by
  • daily and monthly charges if you go into an unarranged overdraft

More information on charges

How to manage your overdraft

Change your overdraft limit

You can request to change or remove your overdraft at any time by calling 03457 212 212 (charges apply). You must make regular payments into your account to reduce the amount you owe.

If you have a Smilemore account, you won't be able to reduce your overdraft lower than the interest free £260 overdraft facility.

Text alerts when you go into your overdraft

To help manage your money and avoid/minimise charges you might pay, we send overdraft text alerts if you go into or you’re about to go into an arranged or unarranged overdraft. We will also send alerts if you have payments due that may not be paid. As long as we have your mobile number, you’ll be automatically opted in for overdraft text alerts. You can opt out of arranged and/or unarranged overdraft alerts at any time. You can contact us to do this in online banking by sending us a secure message or chatting to us on webchat.

Tracking incurred charges

We keep a record of charges for unarranged overdraft requests and unpaid items. We categorise the charges by what’s called a ‘charging period’. A charging period usually starts on the 5th of the first month and finishes on the 4th of the following month.

This information is then added to a statement that we send you at the end of the charging period. The charges are taken from your account on the date shown on your statement.

Arranged overdrafts

If you decide that an overdraft is the best option for you, we would encourage you to request the overdraft as this is generally less expensive than an overdraft that is not agreed in advance. Where we agree to your request for an arranged overdraft, the facility will be provided for up to 12 months.

At the end of the 12 month period we will contact you and may offer you an overdraft for a further 12 month period. Any overdraft limit that we offer you will be based on your circumstances and may be lower or higher than your current overdraft limit. You may request a change to your overdraft limit at any time.

In addition to the overdraft charges above, you will also be required to pay overdraft interest on the amount that you borrow dependent on the type of account that you hold. Please refer to your account charges leaflet for further information.

Unarranged overdrafts

If you request an unarranged overdraft which we agree to provide there will be a charge of £10 when you first go into an unarranged overdraft. We operate on monthly charging periods (the charging period used for interest, commission and charges is the 5th of month one to 4th of month two, please note that days may vary when they do not fall on working days) and if you make a further request for an unarranged overdraft in a charging period - i.e. your unarranged overdraft increases - there will be a further charge of £10.

If you request an unarranged overdraft and we do not agree, we will refuse to make the payment you request by returning it. Any subsequent requests for an unarranged overdraft may also be declined.

In addition to the overdraft charges above, you will also be required to pay overdraft interest on the amount that you borrow dependent on the type of account that you hold. Please refer to your account charges leaflet for further information.

Please view our account charges and charging scenarios. We have developed these examples with the office of fair trading and leading consumer groups to help you think about how changing the way you use your account can affect the amount we may charge you.

Help with infrequent charges

However carefully you manage your account you may occasionally go overdrawn when you hadn’t intended to, resulting in charges. We will automatically waive these charges when you request an unarranged overdraft, providing that:

  • you have maintained your account in credit (or within any arranged overdraft limits) for the previous 366 days, and
  • you return your account to credit (or inside an arranged overdraft limit) within 6 business days.

Putting an Upper Limit on Charges

We will limit your unarranged overdraft charges to £60 per month. If we have provided you with any refunds during that month then this amount will increase by the amount of those refunds.

Is an overdraft right for me?

Our services are designed to meet short-term borrowing needs such as an unexpected bill. Where you have an ongoing or longer term borrowing need, another type of product, for example a personal loan or credit card, may be more suitable. A personal loan may be more suitable if you are looking for lending with fixed monthly repayments over a fixed term. We're no longer offering personal loans, but you may be able to apply for a loan with another financial services provider. Maintaining an overdrawn balance close to your arranged overdraft limit may limit your ability to respond to unexpected bills or payments and you will incur interest charges on the amount you have borrowed. You should consider how you are going to repay an overdraft before making use of this facility.

Once we have agreed to provide you with an arranged overdraft, you have a right to cancel it within 14 days (10 Business Days). If you wish to do so please write to us at The Co-operative Bank p.l.c., Delf House, Skelmersdale WN8 6GH or telephone us on 03457 212 212. If you decide to cancel you must immediately repay us the full amount you owe us including any interest or charges. If you do not cancel you are still free to end your overdraft at any time by repaying all amounts owed to us.

How to apply

You can apply for an arranged overdraft by calling 03457 212 212 (charges apply). We are available 8am to 8pm, 7 days a week. You can be assured that every request for an overdraft is considered based upon an individual’s circumstances and in line with our responsible lending policies. We will provide you with a decision immediately in most cases.

Should you be experiencing financial difficulties, we would recommend that you contact us as early as possible. We will be happy to discuss your needs and to help you understand what options might be available to you.

Before you apply

You can calculate the cost of an overdraft based on how you might use it with our overdraft cost calculator.

You can also check if you are likely to get accepted for an overdraft using our eligibility checker.

Further information

You can get further information by calling 03457 212 212 (charges apply). Our branches and will be happy to discuss our full range of borrowing services including overdrafts.

Find a branch

Important documents

There are important changes to our charges and terms and conditions from the 4th of April 2020.

The Co-operative Bank p.l.c. is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority (No.121885). The Co-operative Bank, Platform, smile and Britannia are trading names of The Co-operative Bank p.l.c., P.O. Box 101, 1 Balloon Street, Manchester M60 4EP. Registered in England and Wales No.990937. Credit facilities are provided by The Co-operative Bank p.l.c. and are subject to status and our lending policy. The Bank reserves the right to decline any application for an account or credit facility. The Co-operative Bank p.l.c. subscribes to the Standards of Lending Practice which are monitored by the Lending Standards Board.