If you have overdraft coverage and make a purchase that exceeds your account balance, what is the likely outcome?

When you have overdraft coverage and make a purchase that exceeds your account balance, the likely outcome is that you will be charged an overdraft fee and need to repay the overdrawn amount. Overdraft coverage is a service provided by banks to allow transactions to go through even when there are insufficient funds in the account. This means that the bank will cover the amount overdrawn up to a certain limit, allowing the transaction to complete.

However, this convenience comes with a cost; typically, the bank will impose an overdraft fee, which can be a fixed amount. Additionally, you are required to repay this overdrawn amount, usually by depositing sufficient funds into your account. This allows you to take advantage of overdraft protection while understanding that there are financial implications for doing so.