In this guide, we shall share with you details about FNB South Africa Overdraft interest rate work.
After you have been approved for FNB overdraft and take it, you ought to repay.
When repaying it, you have to pay the interest.
Yes, it is like you have borrowed a short-term loan, and the repayments come with interest.
It leaves many people wondering what FNB overdraft interest rate is.
More people ask how the interest rate arrived at.
In this article, I’ll explore all these questions and offer an answer to all of them.
What You Must Know About FNB South Africa overdraft Interest Rate
The FNB Overdraft is a financial facility for all customers with a cheque account.
The facility is meant to help them access extra money to what balance is in their account and repay it immediately any deposit is made to the account.
You have to apply to access the FNB overdraft, and the bank will evaluate if you qualify.
If you qualify for the overdraft, the bank will also limit the amount you can access.
You can use the overdraft to pay bills or withdraw at the nearest FNB South Africa ATM.
There are several factors that the bank takes into consideration when assigning you the limit, such as your credit score, account value, your credit repayment records, among other factors.
The FNB overdraft is like a short-term loan facility, but you can utilize the loan up to the limit assigned.
After you have used the loan, you’ll have to repay, and there is also interest.
Let learn how interest is determined.
How Is Overdraft Interest Calculated
Knowing what is FNB overdraft and an overview of how it works, the next important thing is to know the interest rate.
The bank determines the interest you have to pay according to the limit you can access.
More so, the interest is paid according to the amount you have used within your limit.
The lower the amount you have utilizes, the lower the interest you pay, and the higher the overdraft you have utilized, the higher your interest.
The interest is calculated per day from the time you utilized the overdraft when you repay it.
You can also avoid paying high interest by paying the overdraft on time.
The short time you take to repay, the lower interest you pay.
In conclusion, FNB South Africa uses a calculator to determine the interest rate depending on the overdraft limit and the time you take to repay it.
Failure to pay the overdraft within an agreed period, usually within 30 days, leads to penalties.
The failure also affects your limit because it can be lowered or blocked from accessing the overdraft in the future.
That is how FNB South Africa Overdraft interest rate work.
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