HSBC to offer £300 interest-free overdraft buffer in response to coronavirus
HSBC is to increase the interest-free overdraft buffer on its main current accounts to £300 next week in a bid to help customers impacted by the coronavirus pandemic.
Both HSBC bank account and Advance account holders will soon be able to go up to £300 overdrawn interest-free, for a period of three months.
The new buffer, which is normally £25 interest-free, will come into effect from next Thursday (26 March). It will apply to all customers with the accounts – so you won't need to prove you've been specifically impacted by coronavirus.
HSBC is one of a number of banks which has substantially hiked its overdraft interest rate recently, increasing its overdraft rate from 17.9% to 39.9% last week. For full details, see our HSBC to hike overdraft fees MSE News story.
For weeks we've warned that overdrafts are the new danger debt – with interest rates double those of high street credit cards. This follows a change by regulator the Financial Conduct Authority, which means that from Monday 6 April this year, all banks must replace daily/monthly fees with a single interest rate to improve transparency.
An HSBC spokesperson said: "We are here for our customers in these truly extraordinary times. We recently added the option of a mortgage payment holiday, which we had not previously offered, and now we are providing additional relief on overdrafts for millions of our current account customers. This will provide some welcome short-term cash flow support at this crucial time."
For full help on everything from mortgages and sick pay to childcare and cancelled events, see our Coronavirus Financial Help & Rights guide.