UK consumers have been warned that they could face sizable fees for entering an overdraft facility without their bank’s authorisation.
With millions of Britons already struggling to become debt free, MoneyFacts.co.uk has suggested that using an unauthorised overdraft facility can be an expensive method of financial management.
But, with many people dealing with a debt management hangover from the festive period, the financial comparison firm claims that some consumers will add to their problems by borrowing without permission.
“Overdrafts are designed to manage short term cash flow problems, not to fund your day to day living and eventually become hardcore borrowing,” said Lisa Taylor, analyst at Moneyfacts.co.uk.
“If you find yourself permanently living in the red, it’s time to take stock and review your budget and perhaps look at alternative and cheaper ways to fund this.”
Last week, the Consumer Credit Counselling Service predicted that the rate of bankruptcy in the UK would increase considerably over the next few months.