There may be times when you try to make a transaction but don’t have enough money in your account. If the transaction is made, this may trigger an Overdrawn Fee, so it’s important to know what this is and how to minimise the chance of incurring the fee.
If your account becomes overdrawn, the balance would be negative. It’s important to top up your balance as soon as possible so it would be returning the balance to credit plus putting funds to cover future payments to avoid overdrawing it further. You may incur an Overdrawn Fee and debit interest may be charged on the negative balance.
To avoid being charged a fee, it’s good to:
Check your account regularly to ensure it has enough cleared funds to cover your payments/transactions.
Allow enough time for deposits to be processed before you draw on the funds (some can take up to 5 business days).
Keep track of your regular payments (including direct debits and recurring card payments) and reschedule them if you need to.
Fees
Fee type and account
Amount
How is it charged
Overdrawn Fee
This fee will be applied once on any given day on which you overdraw or further overdraw your account if the balance is not returned to a positive balance by the end of the day or to a balance within the agreed overdraft limit (as applicable).
Applies to transaction (except basic bank accounts), savings, home loan and business accounts, plus personal and business loans.
$15 (max per day)
You may be charged $15 if we honour a transaction that overdraws your account
The fee is charged once daily even if you make multiple transactions that overdraw your account on the same day
If you overdraw your account further on another day, you’ll be charged again
You’ll also be charged debit interest for as long as your balance remains negative. This is calculated daily and charged at the end of the month.
Outward dishonour or periodical payment not made fees
When your cheque, direct debit or periodical payment is dishonoured due to not having enough money in your account.
Applies to home, personal and business loans.
$0
Check your balance regularly to ensure there are adequate cleared funds in your account
Build yourself a buffer of cleared funds to cover scheduled payments
Draw some direct debits from an alternative account
Set a reminder in your diary or phone of upcoming payments to help ensure there are enough cleared funds available.
Inward Dishonour Fee When a cheque you deposit is dishonoured or a direct debit to your account is declined. Applies to personal and flexi loans.
$0
Check your balances regularly to ensure there are sufficient funds to cover your payments to your Flexi loan or Personal loan
Build yourself a buffer of cleared funds
Schedule payments a few days after regular deposits, like your salary, are made.
Note: Business accounts and loans includes business transaction accounts, business loans and business overdrafts.
Some example scenarios
Mark pays his $50 phone bill by direct debit.
But Mark doesn’t realise his account balance is getting low – only $10 – when the phone bill is processed. This means his account is overdrawn by $40 and he incurs a $15 Overdrawn Fee. If he had opted in to receive regular balance alerts, he could have received a notification on his phone and known to top up his account before it was overdrawn.
Jose pays an unexpected bill to fix his car after it breaks down.
But Jose forgets to check his balance after the transaction is processed, so he doesn’t have enough funds to cover the rent which is due in two days and paid by direct debit. His account becomes overdrawn by $200 and he incurs a $15 Overdrawn Fee. If Jose had Quick Balance on his Westpac Mobile Banking app, he might have found it easier to monitor his account’s balance and keep it topped up.
Unlike Mark and Jose, Sandra has changed her account Overdraw Preference to ‘disable’, to prevent her account from overdrawing* when it has insufficient funds. One day, the $120 direct debit is processed when she only has $60 in her account, so the transaction is dishonoured. Because of this, she avoids paying $15Overdrawn Fee for overdrawing her account. However, she will need to contact her insurer to make up any missed payment that may have occurred.
*Note: by direct debit, periodical payment, cheque withdrawal or scheduled payments.
Tools to help you manage your spend
Quick Balance Keep on top of your most recent activity by setting up Quick Balance (only available on the Westpac App for mobile). No need to sign in to Mobile Banking; in a flash, you can see your account balance and also your 10 most recent transactions from the past 14 days.
Regular payments list Review your periodical payments or direct debits easily by asking us for a list of the regular payments and transactions on your account. You can request for a regular payments list in branch, with Online or Mobile Banking, or by giving us a call.
Overdraw Preference The Overdraw Preference feature gives you the option whether we allow a direct debit, periodical payment, cheque withdrawal or scheduled payments to overdraw your account (if eligible). Refer to Overdrawing your account for more information.
Did you know?
If you receive a protected payment such as income support or pension while your account is overdrawn, you may still be able to withdraw up to 90% of your fortnightly payment. Learn more.
Check your budget and see when and how you will need funds. Also monitor your transactions to see if you are close to any free limit and bear this in mind when you transact. The most effective way of minimising fees is to avoid paper-based and over-the-counter transactions.
If your checking or savings account pays little or no interest and the fees you pay are high, it can have the same effect as negative interest. Your goal should be to keep fees as low as possible to avoid a “negative interest impact” on your bank accounts.
How can you avoid spending more than what is in your bank account? Keep your own records to compare with your financial institution's records. How could you reconcile your bank account to avoid spending more than you have? Compare your own records of your spending with your financial institution's records.
To avoid being charged a fee, it's good to: Check your account regularly to ensure it has enough cleared funds to cover your payments/transactions. Allow enough time for deposits to be processed before you draw on the funds (some can take up to 5 business days).
Account holders can tend to get out of their monthly fees by opening both a checking and a savings account at the same bank or by maintaining a minimum balance in your account. Sometimes, setting up a monthly direct deposit is enough to waive the monthly fee.
Ask your financial institution about overdraft protection or a line of credit on your account to give yourself an extra layer of protection. Overdraft protection allows you to overdraw your account without incurring insufficient fund fees.
To calculate your AMB, the bank takes the sum of the closing balances for all days in a month and divides it by the number of days in the month. If the average is less than the AMB, the bank will notify you in 2 months that you maintain the minimum balance to avoid the non-maintenance charges.
Most traditional banks require you to maintain a minimum account balance to avoid monthly service charges. These typically range from $100 to $2,500, though most are much closer to the lower end.
Account holders can tend to get out of their monthly fees by opening both a checking and a savings account at the same bank or by maintaining a minimum balance in your account. Sometimes, setting up a monthly direct deposit is enough to waive the monthly fee.
Some banks have a minimum balance you may not dip below. For example, you could be required to have a minimum of $100 in your account at all times. If your balance falls below that amount, you end up with a fee. How to avoid it: You ideally want an account with no minimum balance.
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