Impacts of Salary on Overdraft Usage: Insights from the Economic Wellbeing Explorer

The Economic Wellbeing Explorer has been refreshed with data up to 29th March 2026. Drawing on de-identified banking data from 5 million GB banking customers, the Explorer sheds light on national, regional and local patterns in economic wellbeing through three key indicators: 

• Overdrawn accounts: the proportion of people who become overdrawn on 2+ occasions in a month 
• Living beyond means: spending 120% or more of monthly income 
• Low emergency resilience: account balances falling below £100 on 2+ occasions in a month 

By using near-real-time financial data, the Economic Wellbeing Explorer (EWE) offers an early view of how account holders across Great Britain are really coping. It helps spot shifts in financial wellbeing as they happen, making it a powerful tool for understanding pressure points and trends.

At a glance

There has been a decrease in account holders with overdrawn accounts, with Scottish account holders dropping to 15.4%, English to 16.2% and Welsh to 17.5%. However the number of account holders with low emergency resilience has slightly increased, with a 0.2% percentage point increase in Scotland and England but a 0.1% percentage point decrease in Wales. There has been an increase in living beyond means, with increases in percentage points from 1.19-1.6% across Great Britain. 

A snapshot across the nations shows similar levels across regions with the most variability and largest shifts within low emergency resilience: 

Impacts across Salary Bands

Lower earners are less likely than higher earners to have overdrawn accounts, with account holders on salaries under £25,000 being approximately 1-2% percentage points lower than those with £40,000+ salaries. They are however far more likely to be living beyond their means, with there being an approximate 13% percentage point difference between the salary bands. Higher earners are more likely to use overdrafts, but much less likely to have monthly spending exceed 120% of income.

High rates of living beyond means is likely more closely tied to income adequacy: for lower earners, essentials such as rent, food, energy, transport and debt repayments can push spending far above income. High overdrawn accounts, by contrast, are more likely to know they can afford the overdraft fees and may reflect short-term liquidity management, payment timing, ease of access to overdraft products, or even financial structures. 

This challenges a common assumption that overdrafts are most often used by the lowest earners. The data suggests that repeated overdraft use is not simply a low-income issue. People with lower incomes are more likely to be avoiding using their overdraft while higher income earners may be using overdrafts as an easily accessible form of short-term cashflow management.

By identifying where financial stress is emerging, and which groups are most affected, the Economic Wellbeing Explorer can help policymakers, local authorities, charities, and financial services providers better understand changing household pressures and respond with more targeted support. As cost pressures continue to affect day-to-day finances, tracking these indicators will remain vital for understanding the true state of economic wellbeing across Great Britain.