You will find that banks will vary in how much they charge for different things. This means that if you want a competitive overdraft rate, then you might find that you will need to switch to a different bank. However, you may wonder whether it is worth it.
The overdraft rates can vary quite a bit between banks. Usually they vary between 35% and 40% but there are some that will be outside of this. You may find that if you pay a fee for a current account then you will get a better rate but then you will have to work out whether it is worth it, considering that you have to pay a fee. You may get other benefits of paying that fee so you will need to calculate whether it will provide you with good value for money.
Is a Hassle
Switching banks can be tricky. Although the banks are supposed to make it easy for you to switch to a new bank and help with moving your standing orders and direct debits across it can still take a bit of time to get it all sorted out. You may find some do not switch properly and you may find that you will also need to swap over payments going in to the account such as your salary, pension etc. You may also need to get used to visiting a different branch, if you deal with a branch or banking online or calling a different bank etc. However, if you can save a significant amount of money, then it could be worth it, but the amount that you save, could very much depend on how much you are already paying as well as how often you use the overdraft facility. If you rarely use it, then it may not be worth the hassle, but if you use it a lot, then it could be.
Rate Could Change
There is always a risk that the overdraft rate could change. So, you could find that you will move banks to get a better rate and then you will find that the rate changes and you will be able to get a better one elsewhere. It can be very frustrating, but when you sign up to a variable rate, then that is the risk that you take.
It is also good to consider the customer service that you get from the bank. You might value this a lot and therefore, it could be a risk changing to another one and therefore you could find that you are reluctant to change. Having good customer service can be worth a lot as it is nice to know that any queries that you have or any problems that you also have will be resolved easily.
It is not an easy decision to make. However, if you use the overdraft a lot, then the cost difference could be a lot more significant and therefore make a bigger difference to you and therefore make it more worthwhile switching. However, it is worth thinking about the customer service and the bank itself and whether you feel that you get good value for money compared to what you think you might get form others. This is because it can be a hassle to switch and you may find that the rates change anyway and the place you go to may put theirs up and the one you move from might put theirs down so it might end up not being worth moving after all. It will always be a risky thing, but you need to sometimes take a risk if you want to save money so you should give this some serious thought.