Basic bank accounts
Basic bank accounts
Almost everyone has access to a basic bank account, allowing them to receive and pay in funds. People who can’t get a regular bank account can access the banking system with a basic bank account, which excludes the ability to obtain credit. Basic bank accounts are fee-free, so you don’t pay any charges to run your account.
What is a basic bank account?
A basic bank account is a banking option for those who may have a poor credit history, or would otherwise struggle to open a standard current account. A fee-free basic bank account will allow you to use your account for many of your standard needs, including:
- Providing you with a debit card
- Allowing you to set up direct debits for bills and other payments
- Allowing you to pay for goods and services online and in stores
- The ability to withdraw cash from ATMs
- A place to receive your wages, benefits or other income
However, unlike with a current account, you won’t receive an overdraft, and you won’t receive interest on any savings either.
If you have struggled in the past to open a current account, a fee-free basic bank account could be the right option for you, and could even help you begin building your credit score, allowing you to open a current account in future.
In this article
Who’s eligible for a basic bank account?
Basic bank accounts are predominantly designed for people who aren’t eligible for a standard bank account. You may be eligible if:
- You have a poor credit history, county court judgements or have been declared bankrupt. Basic bank accounts don’t provide an overdraft, meaning you won’t be a credit risk to your provider.
- You have no credit history – sometimes having no credit history can be just as damaging, as providers have no record of your ability to reliably borrow or spend responsibly. However, a basic bank account can be a good option for allowing you to build up your credit score and prove your reliability, allowing you to open a current account in future.
- You have recently moved to the country – while you may have a strong credit history where you previously lived, you may find yourself in a totally different credit situation when you move to the UK. A basic bank account could be the right place for you to start.
Be aware that if you’ve been convicted of fraud or have failed ID checks, you might not be eligible for a basic bank account.
How old do you need to be to get a bank account?
You must be at least 11 years old to open your own bank account, and some accounts have a higher minimum age, such as 16.
Some banks offer an account for children and another for teenagers, for example:
- An account for children aged 11 to 15
- An account with more features for teenagers aged 16 to 19.
Some children's accounts expire once you reach a certain age, usually 18 or 19. Your bank usually upgrades you to an adult bank account at this point.
Can I get a basic bank account if I have a bad credit history?
Basic bank accounts are specially designed for people who have a low or no credit rating, and for people who have experienced bankruptcy. But if you’re being made bankrupt, you may be asked to wait for the bankruptcy order to be made before opening the account.
Basic bank accounts can be helpful to allow you to build or rebuild your credit history.
If you're worried about your finances, you may want to get some free, impartial advice to help you manage. You can get help from:
Can I get a basic bank account if I’m in prison or have a conviction?
Generally, having a conviction isn’t a barrier to getting a basic bank account. However, you might find some difficulties in proving your identity and address. You may be able to get a letter from the prison or probation service to help you.
Many prisons now have arrangements with local banks to open accounts for people in prison. The prison resettlement department should be able to help and advise you.
You may face more difficulties if you’ve been convicted of fraud. Banks have systems in place to check for applications from people convicted of fraud and related activities, and you may be turned down because of this.
For more information on banking for anyone who has a conviction see The Information Hub designed to help people with criminal convictions.
Can I be refused a basic bank account?
A bank might refuse to open a new basic bank account if:
- you can’t give them proof of your ID or address
- you can get a standard current account or other bank account
- you refuse a credit check (although you can open one of these accounts if you have a low or no credit rating)
- they’re suspicious that you will use the account unlawfully or fraudulently
If you’re refused a fee-free basic bank account when you apply, you are entitled to ask why. Your bank or building society should tell you the reason in writing unless they suspect you of fraud or money laundering.
If you don’t agree with the decision and think you’re entitled to open a fee-free basic bank account, you can appeal to your bank or building society. If you’re still not satisfied, you can take your case to the Financial Ombudsman Service.
When can your basic bank account be closed?
Your account provider could either close your account, or transfer you from a fee-free basic bank account to a standard current account, under the following conditions:
- You fail to meet the terms and conditions of your account
- You are found to have used the account for illegal or fraudulent activity
- You provide false or inaccurate information about yourself
- You open a current account with another provider
- Your account remains inactive for more than two years
If you meet one of the criteria above, you will receive a written notice of your account’s imminent closure. They are required to inform you at least two months in advance of the account closing. If you feel that your account shouldn’t be closed, you are able to appeal against their decision.
What are the advantages of having a basic bank account?
Basic bank accounts give people who can’t get a standard bank account access to simple transactional banking, including:
- ability to have wages, Universal Credit and other funds paid into the account
- ability to pay bills by Direct Debit
- access to ATMs in the LINK network
- depositing and withdrawing money over the counter at a bank branch or Post Office.
Accounts vary so some banks may also offer:
- access to online and mobile banking
- text alerts to help you control your spending
- debit cards with contactless payments
- access to Apple Pay, Google Pay and Samsung Pay
- cashback when you shop or pay bills.
If these options are important to you, check carefully before you apply to make sure the account offers everything you need.
Typically, all these services are available without charges, so these accounts are known as fee-free basic bank accounts.
What are the disadvantages of a basic bank account?
Basic bank accounts are stripped-back current accounts, so you’re unlikely to get the same range of features you would with a standard current account. For example, you may not get:
- a cheque book
- an overdraft
- the option to set up standing orders
- interest on cash balances.
Like most bank accounts, there’s likely to be a limit on the amount of cash you can withdraw daily. This can vary between £200 and £500. If you want to withdraw more, you might have to give notice in advance.
You may also be charged fees if you pay in cash or cheques in a foreign currency. And additional charges may apply when using your debit card outside the UK.
What charges are there for a basic bank account?
Under rules set down by HM Treasury, and agreed to by the main providers of basic bank accounts, there are no charges for:
- the standard features as long as they are transacted in sterling
- an unpaid payment
- an overdrawn balance.
Banks can charge for paying in foreign currency or by cheque.
There are no bank fees for failed payments – e.g. a payment bouncing because you don’t have enough money in your account. However, you may still be charged a fee by the organisation you owe money to.
If you use a ‘pay-to-use’ cash machine, such as those found in shops, you may be charged a fee, the same as with any other type of current account. You’ll be asked to agree to the fee, usually between £1.50 to £2, before you take your money out so you know what the cost is.
If you want to make a payment via CHAPS, you’ll be charged a fee – this can vary between £20-£30 depending on the bank.
Who offers fee-free basic bank accounts?
Any bank or building society can offer a fee-free basic bank account, but the nine largest banking groups have been required to offer one since September 2016.
How do I apply for a basic bank account?
Different banks may have different processes for applying, with some allowing you to apply online and others requiring you to visit a branch. Some banks may also suggest you apply for their current account and will offer you their basic account if they think it’s more suitable for you.
The easiest thing for you to do is to compare using our website and follow the links to the website of the provider that you’re interested in.
What do I need to open a basic bank account?
Usually, you’ll need one of the following forms of ID:
- full, current UK passport
- current European Union member state identity card
- current UK photo card driving licence
- identity card issued by the Electoral Office for Northern Ireland
- benefit entitlement letters: includes pension, child benefit, income support, disability living allowance (DLA) and jobseeker's allowance
- HMRC tax notification or assessment letter.
If you can't provide any of the accepted forms of ID on the list, contact the bank to explain your situation as there may be other forms of ID that you can use. Each bank may have their own alternatives, but these could include government issued letters or even letters from employers or educators confirming your identity.
You can use the Current Account Guarantee service to switch basic bank accounts. It should take just seven days to switch and have all your Direct Debit payments moved too.
Can I get a joint basic bank account?
You can open a joint basic bank account if both of you qualify to open one. It can be handy if you want to pay bills jointly, for example. You might be able to convert your existing account into a joint account by adding someone else to it or open a new account in both of your names.
But remember, with a joint account both people can make withdrawals without needing the other person’s approval.
What are the alternatives to a high-street basic bank account?
There are a couple of alternatives:
Fintech (financial technology) accounts – some new digital/mobile-only fintech organisations don’t carry out hard credit checks, which can be useful if you have a poor credit record. They will carry out a soft credit check to prove your identity.
Some charge monthly and/or withdrawal fees, while others are free for day-to-day banking but may charge for withdrawals abroad.
What you can do with your account will depend on the provider you choose. Some may just have a card that you need to pre-pay, while others offer closer to a full banking service. Some will allow Apple Pay and Google Pay.
Check and compare what the different providers offer to see if their services would suit your needs. If you regularly need to send money abroad or work abroad, see how much foreign transactions cost.
Some of the new challengers to high street banks, such as Monzo and Starling, have full banking licences so your money will be protected under the Financial Services Compensation Scheme (FSCS). Others hold your money in ring-fenced accounts for protection. If you’re considering this kind of account, it’s worth understanding how your money is protected.
Credit unions – a few credit unions in the UK now offer bank accounts, which people who are bankrupt can apply for. They usually charge a monthly fee and you may be expected to keep a minimum balance in your account to become a member.
The services you can access will depend on which credit union you use. You can pay money and cheques into most accounts and get money out over the counter or using a LINK cash machine. Some accounts will also allow you to pay bills by Direct Debit and use a debit card to pay for things. You won’t be able to get an overdraft, but you may be able to apply to the credit union for a loan.
Can my bank upgrade me from a basic bank account to another type of account?
Banks can review all their basic bank accounts periodically and move customers to a more appropriate Personal Current Account, taking account of:
- the eligibility criteria for basic bank accounts
- customers’ financial circumstances
- the pattern of use on the account.
The bank must give customers at least two months’ written notice, explaining why it intends to move the account. It must also treat customers fairly when making the decision.
Compare basic accounts
We have a wide range of basic bank accounts for you to compare via our website. Simply use our basic current account comparison service to help you find the account that’s right for you.
When looking for the right fee-free basic bank account, you may want to consider the following:
- Do you have access to a local branch?
- Check you can use nearby cash machines for free
- Will you have access to online or mobile banking?
- Check for any limits or “buffer zones” which may allow you to withdraw small amounts when your balance is low
- Are there any charges? This could include fees for using your card abroad or other international transactions