Basic bank accounts

Why open a bank account? Find out more about basic bank accounts and the benefits of having an account.


All banks offer a basic bank account. They are available to everyone, including people who have a poor credit rating due to previous or existing debt problems. Some Credit Unions also offer basic bank accounts.


Why open a bank account?

You can have your wages, benefits, pension and tax credits paid directly into your account.

You can pay in personal cheques for free (although you will have to wait a few days before the money is available for you to spend).

You can pay your bills by direct debit. Most basic bank accounts will also let you set up standing orders.

You can get your money out at cash machines (though some cash machines charge a fee each time you withdraw money).


With a basic bank account you don’t get a cheque book and you don’t get an overdraft, so you can’t spend money that you don’t have.

It is important that you make sure that you have enough money in your account to pay your bills, or you may be charged a fee.


Things to think about when choosing an account

Can you use cash machines near where you live or work, for free?

Is there a branch of the bank or building society near you where you can pay money in?

Can you pay money in or get money out at a Post Office?

Do you get a debit card, and can you set up direct debits or standing orders?

What fees and charges are made if you accidentally go overdrawn?


Proving your identity

The law says that banks and building societies have to have proof a person’s identity before they can open an account for them. This is to stop criminal activities such as money laundering. The documents that they need will vary from one bank or building society to another. If you can’t provide the documents that they ask for, you can ask for your application to be referred to the person that deals with ‘exceptional cases’. You can also go to an independent advice organisation such as Citizens Advice for help.


What if you are refused?

If a bank or building society refuses to open a basic bank account for you, you can ask them why. Unless you have been refused because of suspicion of fraud or money laundering, the bank or building society should let you know why you have been turned down if you ask. Again you can go to an advice agency for help.


Some terms explained


The total amount of money in your account


Debit card

A card issued by a bank that you use to withdraw cash or to pay for your shopping. The money is usually taken from your account immediately.


Direct Debit

A way of paying bills from your bank account. You sign a form allowing the company you are paying to take the money directly from your account on specific dates. This form is returned to the company.

They then take the money from your account automatically on the agreed dates. They have to notify you in advance before changing the amount or the dates of the payments.



A charge for borrowing money, or a reward for saving money. It is usually shown as a percentage of the amount borrowed or saved.



A facility allowing you to spend more from your account than you have in it. The bank will usually charge you interest if this happens, and sometimes other fees as well. You don’t get an overdraft with your basic bank account.


Standing Order

Another way of paying bills from your bank account. The company you are paying will send you a form. This sets out the amount to be paid and the payment dates. You then give this to your bank.

The bank pays the amounts from your account automatically. If the dates or amounts need to change, only you can change them by getting in contact with your bank. The company that you are paying cannot change them.