on this page
A bank account is overdrawn if your balance goes below zero.
This can happen if:
- it looks like you have money to take out but another transaction hasn’t gone through yet
- you use direct debit to pay your bills.
If the bank account you’ve nominated for your Centrelink payment becomes overdrawn it can create a debt to the bank or reduce the amount of your payment you can access. Your bank might also charge you a fee. You have to pay the amount owed and the fee back to them.
Many banks, building societies and credits unions have agreed to protect your payment. If you contact them, they can arrange to take no more than 10% of your Centrelink payment toward the amount you owe in each pay period until the debt is paid. This means you can access the rest of your payment as normal.
Under the Code of Operation, your bank may have agreed to protect your Centrelink payment if you get any of these:
- Age Pension
- Austudy Payment
- Bereavement Allowance
- Carer Payment
- Disability Support Pension
- Farm Household Allowance
- JobSeeker Payment
- Parenting Payment (partnered)
- Parenting Payment (single)
- Sickness Allowance
- Special Benefit
- Youth Allowance/ABSTUDY Living Allowance
- Crisis payment
- Defence Force Income Support Allowance
- Education Entry Payment
- Income Support Supplement
- Periodic Payments of Wholly Dependent Partner's Pension
- Service Pension - age, invalidity, or partner
- War Widow(er)'s Pension.
You should contact your bank to arrange a repayment plan of the amount that you owe, and to arrange access to the rest of your payment. You can choose to pay more than 10% of your payment to your bank if you wish.
Speak to your bank about their fees and repayment policies for customers receiving any of these payments.
Example of a protected payment
If your account is overdrawn and you get a payment of $200, the bank can take up to $20, which is 10%, to repay the amount that you owe. The bank can provide you with access to the remaining $180, or 90%, of your payment.
Banks that agree to the protected payment
A list of banks, building societies and credit unions that agree to the Code are on these websites:
- Australia Bankers' Association members
- Australian Finance Industry Association members
- Customer Owned Banking Association (COBA) members who have signed the COBA Code of Practice.
When the Code doesn't protect your payment
The Code doesn't protect you if any of these apply:
- your account is overdrawn due to a dishonest or unlawful act
- a third party gets money you owe them direct from your account due to a court order
- the overdrawn account is not the account you have nominated to get your Services Australia income support payment.
Help from your bank
Talk to your bank if you overdraw your account. They can help you manage your debt.
If you can't resolve disputes with your bank, you can contact the following:
Help from us
If you don’t have enough money to live on, we can help. We'll check if your bank has followed the Code. Call your regular payment number if you’d like us to help.
You can read:
If English isn't your first language, you can either:
- call our Multilingual Phone Service to speak with a skilled bilingual service officer about Centrelink payments and services
- ask for an interpreter at a service centre.
Other support services
Find a financial counsellor in your area on the Financial Counselling Australia website.
Information in Aboriginal and Torres Strait Islander languages
We have information to help you learn about the Code of Operation in these Aboriginal and Torres Strait Islander languages: