Bank Accounts - Find the best bank accounts currently available. Current accounts, student bank accounts, bank accounts with overdraft facilities and more.
Bank Accounts - Top Level Guide
Moneyfacts Banking best buys:
Follow the links below to Learn about different types of Banking guide:
Bank accounts are offered by both banks and building societies and come in various shapes and sizes from savings accounts to current accounts. When someone refers to ‘banking' they are probably talking about a current account or basic bank accounts. If it's a savings account you're after you can compare savings accounts here.
- A current account will allow you to use the banking system to do everyday things such as paying for things with a cheque, debit card or direct debit. Many people have their salary, pension or benefits paid direct to a bank account by electronic transfer. Current accounts will usually have an agreed overdraft facility.
- Basic bank accounts are the government's attempt to get lower paid people into the banking system who would not be eligible for a full current account. They allow for money to be paid in and provide a cash card and possibly the facility to set up direct debits.
Having a bank account can be
a gateway to accessing other financial products, such as credit cards or
mortgages where the providers need to be sure that repayments can be
made. They will probably look into how you have run your bank account as part
of their credit checking process.
If you're at university or
have just graduated, specialised student bank accounts or graduate
accounts are available which may be suitable for you.
Interest Rates
Many current accounts now
offer higher rates of interest than a few years ago, as banks and building
societies try to attract regular cash deposits from customers
How do bank account providers make their money?
- Up until recently current accounts paid very low rates of interest (if any) but they used the funds in the accounts to lend on to others in the form of loans and overdrafts which they made interest on. This is still true, but where a good rate of interest is offered on the account they make less money on this.
- Fees and interest charges account for a large proportion of the income from these accounts. These are for things like going overdrawn without authorisation, exceeding overdraft limits or where cheques bounce. Banks have been accused of making undue profits from these charges when they are supposed to just cover administration charges. As these charges fall, more accounts are moving to having a monthly fee, but you'll usually get some additional benefit by paying a fee.
Bank accounts aren't as complex as some other financial products but there are a few things to watch out for when choosing a bank account and some key factors to consider in your decision about which bank account is right for you.
Moneyfacts.co.uk has put together guides on current accounts and basic bank accounts. Once you've got the feel for these, then compare bank account best buys at Moneyfacts.co.uk.
