For many the overdraft represents one part of wide range of student finance options. This article considers the pros and cons of the student overdraft.

On deciding to undertake further study at University, many students will be offered a wide range of financing options from banks and other financial institutions. Products include student loans, credit cards and overdraft facilities. The student overdraft can be a useful tool however, it is also one which can lead to significant long term financial problems, if not used right.

What is an Overdraft Loan Facility

Simply put an overdraft is a form of short term loan between the bank and an account holder. The overdraft facility allows the account holder to run a negative bank balance to a pre-agreed level, without incurring penalties. Overdrafts typically do not have repayment dates, as with standard long term loans and may be seen as an “ongoing” source of finance. Man

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