Lloyds Bank is set to scrap the £50 interest-free overdraft buffer on its Silver, Gold, and Platinum packaged accounts from June 8, 2026. The change will affect customers who occasionally dip into their overdrafts, as they will now face daily interest charges from the first pound borrowed.
The bank stated it is moving to a more consistent approach across its current account range, with interest-free overdraft amounts of up to £100 being introduced. However, customers with packaged accounts will lose their existing buffer, meaning even small overdrafts will incur charges.
In addition, Lloyds is discontinuing its Select account, with holders being moved to the standard Classic account, which offers no overdraft buffer. The bank is contacting affected customers directly to explain the changes and confirm that their arranged overdraft limits remain unchanged.
An overdraft allows borrowing when a current account balance falls below zero, but interest charges can be high. Customers are advised to check their overdraft terms and consider using cost calculators provided by banks to understand potential fees.
