Does having an overdraft affect your credit score UK?
Your overdraft won't affect your credit score as long as you pay it off in a timely manner. However, if you start dipping deeper and deeper into your overdraft, and incurring extra charges, you may find that it's harder and harder to pay off your overdraft and you may begin to struggle with the debt.
Do insufficient funds affect credit?
Banks do not report bounced checks to the major credit bureaus, so if one returns marked "insufficient funds," it won't show up on your credit report from Equifax, Experian, or TransUnion—and won't hurt your credit score.
Is it good to have an overdraft?
Overdrafts can be useful for some people. They can help you avoid fees for bounced or returned payments. These happen when you try to make a payment but your account doesn't have enough money in it. But overdrafts should only be used for emergencies or as a short-term option.