Whether you’re studying at university on a part- or full-time course, you are eligible to apply for a student bank account.
These have a number of advantaged compared to regular current accounts as high street banks often offer special deals and incentives to encourage students to choose them over the standard accounts offered.
Eligibility for a student account
In order to be eligible for a student bank account you need to be enrolled on a higher education course within the UK.
Credit scoring is done slightly differently for student accounts, but if you have a particularly bad credit history then your application may be rejected and you may be offered a more basic account.
Advantages of student accounts
Often, student bank accounts will come with a 0 per cent overdraft, which can be increased over the course of your studies.
Student bank accounts also often come with a Student Credit Card, so you can manage your finances easier, using just one provider.
You will usually have the option of switching your account to a Graduate account after graduating, and these often come with similar advantages to the student account, such as the 0 per cent overdraft.
Over the duration of the bank account, you will be able to build up a relationship with your bank, which may help with future dealings.
Student account incentives
Many accounts offer incentives to encourage you to choose on bank over another. These are to be considered carefully and not be the sole reason for selecting an account, but can be beneficial.
They can include:
- Free five year railcard
- Free mobile phone insurance
- Electronic good
- Like any other current account, you will have the facility to set up direct debits, standing orders and have access to online and phone banking.
- You will receive a Debit Card for making purchases in shop and withdrawing money from ATM’s.
Many accounts advertise a large 0 per cent overdraft, but in some cases this is an ‘up to’ limit rather than a guaranteed amount.
It is possible to slowly accumulate large amounts of debt over the course of your studies, which will need to be repaid later.
Does applying for a student account affect my credit score?
When you apply for any product with an element of lending attached to it, you will be credit scored before the lender approves you.
As a student, you may have very little data stored by the credit reference agencies about your financial history and so in some cases you may be turned down for the student bank account.