Bank Accounts

johncbaker

Can someone advise why banks do a credit check when you want to open a current account? You are not asking for credit, and you are now issued a debit card (unless you are offered a basic account) rather than a cheque book which will not authorise payment if you do not have the money in the account.

My wife has just changed accounts and all the banks she tried would only offer is a basic account where they would only provide a cashcard which in this day and age is useless. This is due to going over her overdraft on her other account. You might suggest that she stays with her current bank but she cannot afford the £60 bank charges everytime she goes overdrawn(which is usually down to the £60 charge).

She is going to fight the charges once she has this other account set up.

benoit

johncbaker wrote: »

Can someone advise why banks do a credit check when you want to open a current account? You are not asking for credit, and you are now issued a debit card (unless you are offered a basic account) rather than a cheque book which will not authorise payment if you do not have the money in the account.

My wife has just changed accounts and all the banks she tried would only offer is a basic account where they would only provide a cashcard which in this day and age is useless. This is due to going over her overdraft on her other account. You might suggest that she stays with her current bank but she cannot afford the £60 bank charges everytime she goes overdrawn(which is usually down to the £60 charge).

She is going to fight the charges once she has this other account set up.

The credit check gives the bank a detailed picture of how you manage your finances. For all they know you could have a string of bank accounts that were closed because of bounced cheques etc, in which case they might not want your business.

onlypaddy

if she regularly goes over her overdraft limit then a basic account is all that will be offered.

You are not asking for credit, and you are now issued a debit card ........which will not authorise payment if you do not have the money in the account

a common misconception. debit cards do allow you to go over your limit as long as you have an available balance greater than £0. you can have a £0.01 available balance and use your debit card to buy a weeks shopping (believe me, I've done it many moons ago)

cash cards arent useless. you can get cash with them

granted, you cant use them in retailers but with a history of going over an overdraft limit, banks will be reluctant to provide this facility again until your wife can show she can handle her finances

miss_missy

hi
just to add a little extra a credit check is done on a current account as you may get an overdraft and that is credit!
you may not ask for an overdraft immediately but once you have a current account you do have the ability to possible get overdraft

just one question john do you and your wife know that an over draft is credit? and therefore once using it you have another debt? please dont take offence at the questions its just some people dont seem to think overdraft are anything but extra money to spend and forget they are a form of credit

also one last thing to add it would probably be best if your wife tries to pay of her overdraft and learn to spend less by opening a new basic account this would allow her to pay back her overdraft over a few months if she thinks of it like any other debt, maybe going over to debt free wannabes and posting an soa would help her do this,

oh almost forgot i do believe that at least some basic account come with debit cards natwest do but i think there is something that means the debit card is not fully auth so you cant spend money you dont have not 100% sure about how they work as i dont know much about basic accounts but im sure someone will come along who will be able to give you more info

Debt_Free_Chick

johncbaker wrote: »

This is due to going over her overdraft on her other account.

This is exactly why they do a credit check. Exceeding an overdraft limit essentially tells them that she doesn't manage her finances well, therefore they are only offering her a restricted banking facility.

Sorry

willo65

As Miss-Missy has said Natwest do offer a Step account with Visa Debit card.

pmduk

Most basic bank accounts offer a debit card now.