Leanne Macardle

Leanne Macardle

Editor
Published: 01/03/2019

At a glance

  • Basic bank accounts offer the basic features required of a current account.
  • Most provide a cash card and will allow standing orders and direct debits.
  • Ideal if you don’t want the temptation of an overdraft or have had difficulty opening other current accounts.

Basic bank accounts are, as the name suggests, a no-frills type of current account. They allow you to receive payments into your account (such as from your employer) and generally offer the following services:

Unlike some other current accounts, basic bank accounts normally don't:

  • Charge a monthly fee, so offer free banking.
  • Allow you to go into overdraft.

Who are basic bank accounts good for?

As they are free and don't let you get into debt with an overdraft, basic bank accounts are suitable for:

  • Young people opening their first current account.
  • People who don't want the temptation of spending more than they earn.
  • People who have had debt problems in the past.

Moneyfacts tip

Moneyfacts tip Leanne Macardle

If you can't meet the normal address verification requirements to open a current account, you may still be able to open a basic bank account.

You're not safe from nasty charges though

Although you can't go into overdraft, this doesn't mean you’re immune from charges.

You need to keep a watch over your spending to ensure that your direct debits and standing orders are covered, otherwise the payment will bounce and you may be charged a fee. There could be other costly repercussions too, for instance, if you were settling the minimum payment on your credit card.

Watch out when you go to take out a basic bank account

Be careful in branch if you want to switch to a basic bank account. Banks and building societies make less money out of these accounts and would much prefer you to have an account where you pay a monthly fee, so stick to your guns and don't be persuaded to take out an all singing, all dancing current account if it's not what you want!

Disclaimer: This information is intended solely to provide guidance and is not financial advice. Moneyfacts will not be liable for any loss arising from your use or reliance on this information. If you are in any doubt, Moneyfacts recommends you obtain independent financial advice.

pound coins

At a glance

  • Basic bank accounts offer the basic features required of a current account.
  • Most provide a cash card and will allow standing orders and direct debits.
  • Ideal if you don’t want the temptation of an overdraft or have had difficulty opening other current accounts.

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