The maximum amount that your bank is prepared for you to borrow from your current account.
When a customer exceeds their authorised overdraft limit, they go into unauthorised overdraft which often results in the customer being charged one or more fees, together with a higher rate of lending on the amount by which they have exceeded their authorised overdraft limit. The fees charged by banks can vary.
A customer may also incur a fee if they present an item which their issuing bank declines for reason of insufficient funds, that is, the bank elects not to permit the customer to go into unauthorised overdraft. Again, the level and nature of such fees varies widely between banks.