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Can you get an overdraft whilst on disability allowance?

  • 18-09-2021 6:02am
    #1
    Registered Users Posts: 5


    I’m wondering if it is possible to get an overdraft with a bank if you’re on disability allowance welfare payments? I wouldn’t use more than 100-200 euro at a time if i needed to, this is purely for a backup in between weekly payments. AIB is my bank.



Answers

  • Registered Users, Registered Users 2 Posts: 27,009 ✭✭✭✭Dempo1


    Every person's relationship with their bank is different and I'm guessing a decision to approve an O/D to any customer depends on many different factors.

    Whilst you have a regular income with DA , it is low , obviously you might have other income ,I'm just basing my opinion on DA income.

    I see no reason why your bank would refuse a small O/D facility on the basis of being on DA, any decision on a loan or O/D is based on customers ability to re pay a loan or service an O/D facility. You must however factor in there is a cost associated with such a facility such as set up and interest charges, so I'd just caution you on this. Interest charged on O/D very expensive.

    Whilst a personal banking question

    Perhaps you could ask if others on these Threads have applied for O/D's whilst on DA

    Some excellent advice on these Threads


    Regards

    Is maith an scáthán súil charad.




  • Moderators, Business & Finance Moderators Posts: 10,363 Mod ✭✭✭✭Jim2007


    Until you actually apply, you won’t know. Generally speaking an overdraft is intended to cover a short term non recurring cash flow issue. The rules for operating the account require it to be in credit for certain periods of the year and the outstanding balance is payable on demand.

    That said there are people who use an overdraft to supplement their income, but it becomes a vicious circle of paying back the loan with interest and then start borrowing again and the balance rises over time. In other words an overdraft is intended to solve a cash flow problem not a deficiency of income.

    Obviously on a DA, you need to manage your money carefully and of course you should check if you have claimed all your entitlements etc. With so much work being done remotely now, is there any chance you could supplement your income? My mother-in-law usually makes about 100 - 150 Euros a month doing online paid surveys, user tests etc and it just takes her a couple of hours a month.



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