Money Saving Expert Martin Lewis has issued new advice for those who frequently use their overdraft, as banks begin to rethink the way they're charging for the service.
Nationwide has recently increased its authorised overdraft rate to 39.9% APR - a move that most high street banks are expected to follow in the coming months.
"This all comes on the back of a rule changed by the regulator, the [Financial Conduct Authority], that says from April all overdrafts must be an interest rate rather than a mix of daily charges so that you can see exactly what they're costing," Martin told Good Morning Britain.
Generally, if you're within your overdraft limit, this will cost you more, he said.
"People always talk about credit cards being bad and debit cards being good. Well, a debit card is a debt card too if you're overdrawn, and at 39.9% it's way more expensive than your credit card.
"In fact, lots of people pay off their credit cards from their overdraft account," he said.
But in many cases, the overdraft will cost you more than if you paid the minimum on your credit card.
"Just to explain the type of rise, First Direct at the moment for over £250 is 15.9% and then a £5 daily fee if you go beyond your overdraft limit.
"It's now getting rid of that £5 fee, and will just be 39.9%.
WATCH: Martin Lewis explains changes to overdrafts coming in 2020
"What we're seeing is a shift from people who go beyond their overdraft limit to people who are within the limit."
But if you find yourself in your overdraft now, with no way to pay it off quickly, there are options, he said.
“First Direct has a £250 0% overdraft and gives you £50 to switch to it, so if your overdraft is £300, switching there might help.
"Nationwide has a one year interest free overdraft credit score dependent, so you can move there and try and get rid of the overdraft within the year.
"Otherwise, you need to look at a specialist money transfer credit card, which will pay your overdraft for you, so you owe the credit card instead."
But the most important thing is not to neglect your overdraft, he said.
"Don't sit on your overdraft, an overdraft is a debt."
