The Student Room Group

Bank demanding repayment of overdraft

Hi, so I’m a second year student and have a student account open with NatWest which I am £1000 overdraft in (not great I know, I just used it towards rent payments last year when I was strapped for cash). I have a second bank account which I use for my everyday spending, so I haven’t deposited or withdrawn any money from this NatWest account for probably over a year now. I stupidly kept procrastinating paying some money in despite receiving a few messages now saying that I needed to pay money to keep my account active. I’ve just received a message from them notifying me that they intend to remove my arranged overdraft and demanding that my overdraft be repaid within a month. I cannot afford to pay back this amount and I’m terrified. I have just learnt that banks reserve to right to demand repayment at any time, but I’m wondering if I speak to someone on the phone and explain my circumstances, this might be reconsidered? I’ve just paid a very small amount of money in, just to “keep the account open”, but I fear it’s too late for this now :frown: any advice would be greatly appreciated
Original post by grace04935
Hi, so I’m a second year student and have a student account open with NatWest which I am £1000 overdraft in (not great I know, I just used it towards rent payments last year when I was strapped for cash). I have a second bank account which I use for my everyday spending, so I haven’t deposited or withdrawn any money from this NatWest account for probably over a year now. I stupidly kept procrastinating paying some money in despite receiving a few messages now saying that I needed to pay money to keep my account active. I’ve just received a message from them notifying me that they intend to remove my arranged overdraft and demanding that my overdraft be repaid within a month. I cannot afford to pay back this amount and I’m terrified. I have just learnt that banks reserve to right to demand repayment at any time, but I’m wondering if I speak to someone on the phone and explain my circumstances, this might be reconsidered? I’ve just paid a very small amount of money in, just to “keep the account open”, but I fear it’s too late for this now :frown: any advice would be greatly appreciated

You say you "haven’t deposited or withdrawn any money from this NatWest account for probably over a year now". What is the requirement in terms of paying in money to keep the account open? (I've seen requirements to pay-in at least £500 a term elsewhere to keep the overdraft available, but I'm not familiar with NatWest's requirement.)

If you've been in breach of their rules for about a year, and have ignored "a few messages now saying that I needed to pay money to keep my account active", then it may well be too late.

What facilities does you second bank account have they makes it so attractive that you've effectively abandoned your NatWest account?

Have you tried applying for an overdraft on second bank account? Then you could just move the debt from NatWest to this account, and close the NatWest one.

Alternatively, you could try opening a student account (with a free overdraft) at whichever bank the second account is with. They almost certainly have a rule which says you can't student account elsewhere, but if you explain that you're moving your student account from NatWest, they may allow the two accounts to overlap for a few weeks.

You know that there's a moral in this story somewhere, right? :wink:
Reply 2
NatWest's page at https://www.natwest.com/current-accounts/student_account.html says this: "You must use your Student account as your main account by depositing your wages or other regular income into it."

Banks offer perks like interest-free overdrafts because they know that people don't generally change their banking arrangements, and that if they can get you onboard as a customer then you're unlikely to move away. And while you're a customer, you're more likely to buy other financial products from them.

So NatWest have been keeping up their end of the deal, by giving you a valuable perk. It's not unreasonable for them to have assumed you'd stick to your side of the deal too by using the account as your main account -- but you didn't, even after prompting.

Unfortunately, a lot of banks seem to only allow a student account to be opened by first-year students, so your choice of a different student account to move to might be quite limited.

Does the bank that you use for your everyday spending offer a student account?

You could plead with NatWest to allow you to retain your student account and overdraft facility -- they might even at this late stage allow you do to so. If they allow you to do that then I suggest that you switch all your banking away from your other account immediately. If they won't relent, then you should ask them for longer to repay the overdraft and explain your financial situation -- I think the regulators require banks to treat people in financial difficulties sympathetically. But at the moment you seem not be engaging with NatWest at all.

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