Overdraft requirements for coming growing season.

[capfits]

Getting to the time of year for the chat with bank manager.
Not expecting any major surprises in terms of arrangement fees or rates.
Think we could reduce our requirements but not so sure it will be wise to with the political stuff going on.
Threats and opportunities and all that.
So what are your overdraft plans?

 

[glasshouse]

Getting to the time of year for the chat with bank manager.
Not expecting any major surprises in terms of arrangement fees or rates.
Think we could reduce our requirements but not so sure it will be wise to with the political stuff going on.
Threats and opportunities and all that.
So what are your overdraft plans?

You forgot one category
Not allowed / dont want an overdraft.

 

[neilo]

You forgot one category
Not allowed / dont want an overdraft.

Doesn’t that make you an honorary member of the fourth category?

 

[glasshouse]

Doesn’t that make you an honorary member of the fourth category?

I wish

 

[Muddyroads]

Are overdraft rates not going up considerably in the next couple of months, or is that just for unauthorised ones?

 

[lazy farmer]

Are overdraft rates not going up considerably in the next couple of months, or is that just for unauthorised ones?

For individuals yes. Certain banks(probably all in the end) are putting up authorised rates massively as other streams of income have been curtailed by the FSA. This should not effect business customers.

 

[Still Farming]

All change March of interest charged on arranged overdrafts?

 

[glasshouse]

Just got a big payout on ppi
More pending
No wonder they need money

 

[lazy farmer]

Sounds like retail customers

 

[Bury the Trash]

Getting to the time of year for the chat with bank manager.
Not expecting any major surprises in terms of arrangement fees or rates.
Think we could reduce our requirements but not so sure it will be wise to with the political stuff going on.
Threats and opportunities and all that.
So what are your overdraft plans?

Why do you have to be minted to not 'need' an overdraft ?

 

[anzani]

Given that overdrafts are normally subject to withdrawal by banks ' upon demand', are you able to arrange more secure financing for working capital?, it could be an 'uncertain' year!

 

[lazy farmer]

Given that overdrafts are normally subject to withdrawal by banks ' upon demand', are you able to arrange more secure financing for working capital?, it could be an 'uncertain' year!

Nah this yrs fine it’s the yr after?!

 

[teslacoils]

No change here. Cut my 2020 cloth once the writing was on the wall last October.

 

[capfits]

You forgot one category
Not allowed / dont want an overdraft.

Of course I could have put that in.
Dare say for many we could actually ditch the overdraft with a couple of years very tight financial management, but the truth is most of us that have them will use them as nothing more than cashflow management tools.
That cashflow management tool will be the same that one some choose not to pay some of their suppliers until receipts from sales come in.

 

[Campbell]

Looks like non business account holders are in for a thrashing. Av 1% interest on big balances and up to 40% on unauthorised borrowing. Keep it under the mattress.........

 

[glasshouse]

The situation on overdrafts is somewhat different now from 12 yrs ago.
Govt rules on holding capital mean banks can only lend against land or property

 

[neilo]

Looks like non business account holders are in for a thrashing. Av 1% interest on big balances and up to 40% on unauthorised borrowing. Keep it under the mattress.........

The changes are for authorised overdrafts too, bringing an end to the penalty clauses for unauthorised borrowing, where the banks have been charging for each day over the limit, on top of high interest rates. Apparently it’s unfair!

I was shocked by the report on BBC Breakfast that reckoned 11million people in the UK used unauthorised overdrafts (as well as 14m using authorised ones). I had no idea so many were regular borrowing at crazy rates like those.
I have a (free) OD facility on my current account, but I’ve never used it. My business OD is in regular use for working capital though, which is what they’re meant for, not long term borrowing. It used to be that, if you stayed in the red, the banks would try to move some of the debt onto longer term borrowing such as loans, but I suspect it has more to do with which product provides the biggest margin to them now.

 

[teslacoils]

I was shocked by the report on BBC Breakfast that reckoned 11million people in the UK used unauthorised overdrafts (as well as 14m using authorised ones). I had no idea so many were regular borrowing at crazy rates like those.

I think the number of families who have under £500 of cash or savings at any one time might shock you.

The 2018 figure I heard was 1/4 *families* have under £100.

 

[Johnnyboxer]

I think the number of families who have under £500 of cash or savings at any one time might shock you.

The 2018 figure I heard was 1/4 *families* have under £100.

Blimey, that’s a shock

Do working families only live hand to mouth ?

 

[Phil P]

I think a lot of the trouble with most people (especially farmers) is if they have funds available they’ll spend it on something (usually shiny machinery).
We don’t have an overdraft facility, I’m not saying there’s not times of the year when I wish we did but it takes a lot of cash flow management to keep out the red! Trouble is as soon as you dip into that overdraft it can take along time to dig yourself out, so if the money isn’t there you can’t spend it.
we do fined that business credit cards help smooth out monthly outgoings. They get paid of each month but if purchases are timed just right it can give you 60 day before the balance is due.