If you’ve been living in your overdraft for years, you could be owed THOUSANDS.

While everyone is talking about Car Finance (PCP) claims right now, there is another major refund category quietly paying out to thousands of people: Unaffordable Overdraft Claims.

Banks have a legal responsibility to ensure that lending is "affordable." If you were stuck in a cycle of debt—constantly using your overdraft just to pay bills or living in the red month after month—your bank may have failed in its duty of care.

Here is how to know if you can claim back unfair interest and fees.

The "Persistent Debt" Trap

The core of this claim isn't just that "overdrafts are expensive" (we know they are). It’s about irresponsible lending.

If you were constantly overdrawn for a long period (usually 12 months or more), the bank should have stepped in. They are supposed to notice that you are struggling and offer help—like a repayment plan or a lower interest rate.

Instead, many banks simply increased overdraft limits or continued piling on fees, pushing customers deeper into a hole they couldn't dig themselves out of. This is what the Financial Ombudsman Service (FOS) often rules as "unfair."

Am I Eligible to Claim?

You don’t need a lawyer to do this. You just need to fit the criteria of a "repeat user." Ask yourself these three questions:

1. The "Hardship" Test: Did you use your overdraft to pay for essentials (rent, council tax, food) rather than just occasional luxuries?
2. The "Cycle" Test: Were you overdrawn for most of the year? (e.g., You get paid, go into credit for a few days, and then immediately drop back into your overdraft).
3. The "Ignored" Test: Did the bank increase your limit without checking if you could actually afford it, or fail to offer you help when you were clearly struggling?

If you answered YES, you could be entitled to a refund of all the interest and fees charged during that period.

How to Claim (For Free)

Do not pay a claims company. They will take up to 30% of your money for sending a generic letter you can send yourself in 5 minutes.

1. Check your statements: Go back through your banking app. Look for a pattern of constant overdraft use and high fees/interest charges.
2. Write to your bank: Most banking apps have a "Chat" or "Complaints" function.

• Template text: "I believe you failed to lend responsibly. I was in a cycle of persistent debt for [X years], using my overdraft for essentials. You did not intervene to help me, and instead allowed charges to accumulate. I am requesting a refund of all interest and charges associated with this unaffordable lending."

1. Escalate to the Ombudsman: If the bank says "No" (which they often do at first), you can forward your complaint to the Financial Ombudsman Service for free. They have a high success rate for these specific types of claims.

The Bottom Line

An overdraft is supposed to be a safety net, not a spiderweb. If your bank watched you struggle and profited from it instead of helping, you are well within your rights to ask for that money back.