Overdrafts

A short-term way to borrow money through your current account

What is an overdraft?

An overdraft is an on-demand credit facility that gives you increased flexibility to manage your day-to-day finances, providing you with a safety net for when something unexpected arises. It is a short-term way to borrow money through your linked current account.

Types of overdraft

An overdraft is often referred to as an 'arranged overdraft' or an 'unarranged overdraft'.

  • An ‘arranged overdraft’ is a credit facility, that enables you to transact from your linked current account even when your account balance goes below zero. An arranged overdraft has an agreed limit, approved by Handelsbanken in advance.
  • An ‘unarranged overdraft’ occurs when you either exceed your arranged overdraft limit, or you continue to transact on your current account after your balance goes below zero, without having a pre-approved arranged overdraft. Continuing to transact on your account without a pre-arranged overdraft, or that exceeds your approved credit limit, may result in payments not being made.

It is important to remember that both types of overdraft have interest charges and additional fees that may apply. In general, ongoing and excessive use of an overdraft facility may have an impact on your credit file.

Features and benefits of an overdraft

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  • On-demand, short-term borrowing, giving you flexibility to help manage your money.
  • We charge one interest rate on the amount of the overdraft that you’ve used.
  • You’ll be able to see your overdraft  in online banking and our app or you can call Customer Connect, to find out your arranged overdraft usage or your account balance when you’re overdrawn.
  • You can choose to have your arranged overdraft until further notice or you can have a fixed expiry date for it.

Key information

Are there any restrictions for an overdraft?

We don’t currently offer text alerts when you go into your overdraft or near your overdraft limit. 

How do I close my overdraft?

You can close your overdraft by writing to your branch or by emailing your account manager.

Overdraft rates and fees

  • Our debit interest rate for overdrafts is made up of the Handelsbanken Base Rate, plus a margin; this is the interest rate that you’ll be charged for the amount of your overdraft that you use. Your branch will confirm your interest rate.
  • There may also be an arrangement fee and an annual renewal fee for overdrafts over £10,000.

You can use our overdraft calculator to see an illustration of how much an arranged overdraft may cost you:

Overdraft Calculator

£1
£15,000
£999
1
31
9
Overdraft interest cost£5.36

In the calculator above, the representative interest rate is 21.75% per annum (variable), which covers both arranged and unarranged overdrafts.

Please note, this is purely for illustrative purposes only. Your individual interest and term is agreed with your branch.

Is an overdraft the best option?

An overdraft is used when you require instant access to additional funds for a short period, to cover any unexpected short falls. An overdraft is not generally suitable when you require a longer-term borrowing solution.

Your account manager will be happy to discuss your needs, and provide you with options that best suit your individual circumstances.

Apply for an overdraft

We make the process smooth and straightforward from start to finish. Depending on your circumstances and subject to eligibility criteria, we may be able to assist you with an overdraft.

Become a customer

Find out more about becoming a Handelsbanken customer or call 0800 470 8000 to speak to our Customer Connect team.
Become a customer

Already a customer

To know more, please speak to your account manager at your local branch.

Find your branch

Important information

Please note that an overdraft is only available to UK residents aged 18 or over. All borrowing is subject to status and security may be required. Overdrafts are repayable on demand (including any interest or fees), even if we have agreed a term for the overdraft with you. All charges are variable on notice. Certain restrictions apply.