But just what is an overdraft and how does it even work?
Understanding everything about this facility is crucial as it will help you make the right financial decisions.
An overdraft FNB refers to one of the many credit forms offered by the bank.
Image: facebook.com,@fnbSource: UGC
It is a temporary solution to cash flow problems.
How does FNB overdraft work?
How does the FNB overdraft work?
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This is a question most people would want an answer to.
Therefore, this means that it helps to offer you extra funds that come directly from your cheque account.
This includes deductions from sources like your salary.
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This credit facility is referred to as the FNB gold cheque account overdraft.
It will shield you whenever you have insufficient funds in your account.
You will be protected from incurring bank charges on unpaid or returned items.
Image: facebook.com, @fnbSource: UGC
Before the bank allows a customer to use this facility, it embarks on stringent risk assessment.
This involves collecting all the necessary information on your behaviour as far as bank products are concerned.
It can go as far as reaching out to credit bureaus just to make a comprehensive analysis.
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It is as stringent as when applying for credit.
Once a client is cleared.
This is usually based on customers monthly expense vs income ratio.
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This is crucial as it is what determines if you will be able to pay every month.
You will get the overdraft after passing both the risk scoring and affordability assessments.
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Image: facebook.com, @fnbSource: UGC
If you maintain consistent payments then you lower your risk rate and stand out as a reliable borrower.
There are certain things you could do to ensure you are in good standing with the bank.
you’re gonna wanna keep in mind that you may incur certain charges for this facility.
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However, themonthly chargeapplies only if you use more than R200.
This implies that there will be saving on the interest eventually.
FNB overdraft settlement
The settlement of your overdraft is done monthly.
This is then subtracted from any of your deposits as agreed.
FNB overdraft calculator
The bank has its ownspecial calculatorthat helps customers assess their creditworthiness.
You will be able to determine the interest charges based on the duration you have to make payments.
A revolving loan is such a facility that comes with a fixed repayment rate.
On the other hand, overdrafts are meant for account shortfalls and they come with different fees and charges.
Understanding the FNB overdraft facility makes it easy for you to access credit conveniently.
Choose a solution that works for you and double-check that you adhere to the laid down rules and regulations.
She has a Bachelor of Commerce & IT from the University of Nairobi and joined Briefly.co.za in November 2019.
The writer completed a Google News Initiate Course.
you might email her at perisrodah254@gmail.com.
