Overdraft charges are a big money-spinner for banks and constitute 36% of their current account revenues according to the Office of Fair Trading. However, the overdraft market is facing pressures as evolving customer behavior and regulatory pressures squeeze profitability.
Understand how changing customer behavior and regulations are impacting on overdrafts.
Discover what banks can do to make their overdraft propositions more attractive to customers.
What are the key trends affecting the overdraft market?
To what extent do customers use overdrafts?
What can banks do to increase the profitability of overdrafts?
Banks generate 46 on average from overdraft revenues annually on a standard current account.
Overdraft usage has declined since the 2008 crisis as households have become wiser about expensive sources of borrowing.
82% of UK current account holders believe overdraft charges are too high and 70% believe they are too complex.