How Much Can You Overdraft With Current?
Explore Current's unique approach to covering shortfalls. Understand your spending capacity, eligibility, and how to manage it effectively.
Many individuals occasionally face unexpected shortfalls in their account balance, which can lead to transactions being declined. To address these situations, financial institutions often provide various solutions designed to offer a temporary financial buffer. These services aim to help account holders manage their finances effectively, preventing the inconvenience of insufficient funds.
Understanding Current’s Overdrive™
Current offers a specific feature called Overdrive™, designed to help account holders avoid declined transactions when their balance is low. This feature provides funds for eligible purchases that exceed the available account balance. Overdrive™ helps ensure that essential transactions can still be completed, even if there is a temporary deficit in funds.
A key aspect of Overdrive™ is its fee-free nature, which distinguishes it from traditional overdraft services offered by many banks. Unlike conventional overdrafts that often impose significant fees for each instance, Current’s Overdrive™ allows eligible users to overdraw their account without incurring additional charges. Current states it has shielded customers from over $100 million in overdraft fees through this feature.
Eligibility and Overdrive™ Limits
To qualify for Current’s Overdrive™ feature, an active Current account in good standing is necessary, and the user must be at least 18 years of age. A primary requirement involves consistent direct deposits, with a minimum of $500 in qualified direct deposits within each 30-day period. Qualifying direct deposits are defined as Automated Clearing House (ACH) direct deposits from an employer, payroll provider, or government entity. Certain types of deposits, such as bank ACH transfers, peer-to-peer transfers, mobile check deposits, or cash deposits, do not count towards this qualification.
Once these eligibility requirements are satisfied, Current notifies the user, who then must opt-in to activate the Overdrive™ feature. The initial Overdrive™ limit for eligible users typically starts at $25. This limit can be increased by Current based on various factors, including the user’s direct deposit history, overall account activity, and other risk-based assessments. While the maximum Overdrive™ limit can reach up to $200, the exact amount varies for each individual and may change over time as account usage and direct deposit activity continue. Current periodically reviews accounts to make appropriate adjustments to these limits, and users receive notifications regarding any changes.
Using Overdrive™ and Associated Costs
Once an account holder is eligible and has activated Overdrive™, the feature functions automatically when an authorized transaction attempts to draw more funds than are available in the account. Overdrive™ is specifically designed to cover purchases made with the Current debit card, whether these are in-store or online transactions.
However, it is important to understand that Overdrive™ does not cover all types of transactions. It will not apply to ATM withdrawals, ACH transfers, or payments made through peer-to-peer (P2P) services such as PayPal, Venmo, or Cash App. Additionally, Current Pay transfers and checks are not covered by the Overdrive™ feature. A significant benefit of Overdrive™ is that it carries no overdraft fees. This means that while the feature provides a safety net for eligible transactions, users are not charged extra for utilizing this temporary overdraft protection.
Managing Your Overdrive™ Balance
After Overdrive™ covers a transaction, creating a negative balance, the repayment process is designed to be straightforward and automatic. Any subsequent incoming funds, particularly direct deposits, are automatically applied to reduce the negative Overdrive™ balance. This mechanism helps ensure that the overdrawn amount is repaid promptly as new funds become available in the account.
Users can monitor their Overdrive™ usage and current negative balance directly within the Current app. The app displays the remaining Overdrive™ limit and the amount currently utilized, providing transparency regarding the account’s status. This allows account holders to stay informed about their financial situation and plan accordingly for future deposits. Maintaining consistent direct deposits helps in managing the Overdrive™ balance effectively and may also contribute to future limit adjustments.