CONC 6.3 Information to be provided on a current account agreement and on significant overdrawing
Application
This section applies:
- (1)
to a firm with respect to consumer credit lending; and
- (2)
where a firm has entered into a current account agreement where:
- (a)
there is a possibility that the account-holder may be allowed to overdraw on the current account without a pre-arranged overdraft or exceed a pre-arranged overdraft limit; and
- (b)
if the account-holder did so, this would be a regulated credit agreement.
- (a)
CONC 6.3.3 R does not apply where the overdraft or excess would be secured on land.
Current account information
A firm must provide to the account-holder, in writing, the information in CONC 4.7.2R (2) at least annually.
[Note: section 74A of CCA (partial implementation of article 18 of the Consumer Credit Directive)]
Information to be provided on significant overdrawing without prior arrangement
- (1)
A firm must inform the account-holder in writing of the matters in (2) without delay where:
- (a)
the account-holder overdraws on the current account without a pre-arranged overdraft, or exceeds a pre-arranged overdraft limit, for a period exceeding one month;
- (b)
the amount of that overdraft or excess is significant throughout that period;
- (c)
the overdraft or excess is a regulated credit agreement; and
- (d)
the account-holder has not been informed in writing of the matters in (2) within that period.
- (a)
- (2)
The matters in (1) are:
- (a)
the fact that the account is overdrawn or the overdraft limit has been exceeded;
- (b)
the amount of that overdraft or excess;
- (c)
the rate of interest charged on it; and
- (d)
any other charges payable by the customer in relation to it (including any penalties and any interest on those charges).
- (a)
- (3)
For the purposes of (1)(b) the amount of the overdraft or excess is significant if:
- (a)
the account-holder is liable to pay a charge for which he would not otherwise be liable; or
- (b)
the overdraft or excess is likely to have an adverse effect on the customer's ability to receive further credit (including any effect on the information about the customer held by a credit reference agency); or
- (c)
it otherwise appears significant, having regard to all the circumstances.
- (a)
- (4)
Where the overdraft or excess is secured on land, (1)(a) is to be read as if the reference to one month were a reference to three months.
[Note: section 74B of CCA]
[Note: article 18 of the Consumer Credit Directive]