The Co-operative scraps charges on overdrafts

3 January 2012

Interest charges are being frozen for three months for some customers of The Co-operative bank to help them cope with Christmas debts.

Customers with qualifying accounts will see their interest charges put on hold from 5 January until 4 April.

This could see a saving of £74.22 for people with overdrafts of £2,000, and £37.11 for overdrafts of £1,000.

The Co-operative has made this move to help customers tackle their debts but also to bring some competition to the high street.

To be eligible you must have a current account with a standard overdraft, which has been previously applied for and accepted by the bank. But the Cashminder, student, business and corporate banking accounts are not included.

A helping hand

The bank says the average British adult built up £749 in debts last year and only 27% plan to pay it back in the next 12 months. The most common methods of borrowing money were across credit cards, personal loans and arranged overdrafts.

Robin Taylor, head of banking at The Co-operative Bank, says: "In these difficult economic times, we want to offer a helping hand to those customers, who may be struggling financially and give some additional support to those whose finances may be stretched after the festive period.

"This move again highlights how we are looking to bring some much needed competition to the high street, by providing customers with a genuine alternative to the big five banks."

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