Student and Ethical Banking

dogleish

I was wondering what people thought of the co-op, since previously I had decided to go with RBS because of their free-rail card, however, I've heard that they no longer do this. Also, many people have said that they never get the full overdraft amount.

So I was thinking about a bank that would be ethical and listen and generally, be nice. So I looked into the co-op and discovered many great things about it. Unfortunately they have no freebies at all but I'm sure I could live with that. They have a great thing going for members, where you get money back for your savings, using their credit card, buying food from them, travelling with them etc. They also said that even though they're not entitled to helping people out with all the volcano problems, they have, which I think is awfully great of them.

I have applied for lots of scholarships and grants and things so if all goes going to plan, I'd like to put £2000 in their fixed three year account at 4% so that I'll have money for the future. Then I'd get a members credit card to improve my credit rating and to get points to earn back. I've even thought about getting a pension. I could even get insurance too, but I'd probably be better off with a student focused one. I also think they'd be great for the future, getting car insurance and a mortage with them too.

They also say that if you go overdrawn you don't get charged for 6 days! That sounds amazing. They also cap the charges at £150 quarterly, even though I'm really not planning to ever go overdrawn, I have a friend that did all the time and it cost him a fortune.

So what do people think? Does anyone else bank with the co-op?

opinions4u

dogleish wrote: »

I was wondering what people thought of the co-op

Lack of branches would be a concern for me. If you like their supposedly ethical stance, that's nice, but they still decline credit to grannies who fail the score, repossess houses of borrowers who don't pay and tend to offer poor rates to savers and flog expensive travel insurance via their travel agencies. Ethical or marketing. I'll let you decide. Personally I'd choose the bank that gives me the best balance of service, rate/reward and convenience.

since previously I had decided to go with RBS because of their free-rail card, however, I've heard that they no longer do this. Also, many people have said that they never get the full overdraft amount.

The student specific offers tend to arrive en masse in August. That's the time to assess the best range of benefits. As for the "full" overdraft amount - banks tend not to offer it all up front but allow for increases through the term of a course.

So I was thinking about a bank that would be ethical and listen and generally, be nice.

To be honest, expecting your bank to be "nice" is pushing it. They are businesses. You should look to exploit the business arrangement that favours you the most. I once bought a second hand car from a very nice man. The car was awful. Don't buy banking products just because the girl in the local branch is "nice" (then again ... !).

They have a great thing going for members, where you get money back for your savings

Do you want a members' reward or a decent interest rate? For most savers the latter is far more valuable.

using their credit card

From which they earn income on transactions and interest. A good cashback credit card would pay you more.

buying food from them

Their prices are invariably more expensive than Tesco/Sainsbury who offer reward schemes too. Tesco's pays for my family days out.

They also said that even though they're not entitled to helping people out with all the volcano problems, they have, which I think is awfully great of them.

I think all the major banks selling travel insurance have met their moral obligations on this, even where the policy wording doesn't require them to.

So what do people think? Does anyone else bank with the co-op?

Some people like them. Some people like other high street and internet banks too. I think it's dangerous to have a love-in with a single bank though. Spread yourself out a little bit more.

pmduk

Many co-op accounts will let you pay in and withdraw over Post Office Counters which makes up for the shortage of branches. Their phone banking is UK based and, in my experience, very helpful.

dogleish

Ok, so I've spent a lot of time and looked into much more depth of different banks and their offers. I found that the co-op's ISA and savings accounts are terrible in comparison to everything else. I looked up the local building society in St Andrews and found Dumfermline who have a 3.25% rate for only 2 years! Shame they don't have student accounts however.

I'm still not convinced about the points and cashback credit cards and things:
Play.com offer 2 points for £1 on play.com and 1 point for £1 elsewhere. (and a 1,500 points bonus when you spend £150 in 90 days or something)
The Co-op offer 1 pence for £1 in the Co-op, and 1p for £2 elsewhere.
Tescos offer 1 point for £4.
Sainsburys offer 1 point for every £5.

I'm not sure if 1 point equates to 1p, in fact isn't like 0.1p or something? But with the Co-op 1p for £2 spent anywhere, and getting your money back to spend on anything, sounds far better than Tescos and Sainburys. Also, I don't think the co-op is that expensive if you buy everything on special, I wouldn't be buying that much shopping anyway as I'll be in catered halls.

Play.com's offer is also pretty good, and I do tend to buy quite a lot from them so it would be worth it.

But I still don't see how the Tesco and Sainbury's cashback cards are better than the Co-op's...

billbob

Another great thing about the Cooperative Credit Cards are that they donate £1.25 to charity for every £100 spent on the card.

I have been using the card for a while now and the cash back has quickly mounted up. Nice to know a charity will also be getting a donation too.

opinions4u

dogleish wrote: »

Ok, so I've spent a lot of time and looked into much more depth of different banks and their offers. I found that the co-op's ISA and savings accounts are terrible in comparison to everything else. I looked up the local building society in St Andrews and found Dumfermline who have a 3.25% rate for only 2 years! Shame they don't have student accounts however.

But there is no need to have all your money in the same place. Seek out the balance between value and convenience.

I'm still not convinced about the points and cashback credit cards and things:
Play.com offer 2 points for £1 on play.com and 1 point for £1 elsewhere. (and a 1,500 points bonus when you spend £150 in 90 days or something)
The Co-op offer 1 pence for £1 in the Co-op, and 1p for £2 elsewhere.
Tescos offer 1 point for £4.
Sainsburys offer 1 point for every £5.

I'm not sure if 1 point equates to 1p, in fact isn't like 0.1p or something? But with the Co-op 1p for £2 spent anywhere, and getting your money back to spend on anything, sounds far better than Tescos and Sainburys. Also, I don't think the co-op is that expensive if you buy everything on special, I wouldn't be buying that much shopping anyway as I'll be in catered halls.

Take a look at this MSE article on cashback credit cards. That may help you decide what works best for you.

billbob wrote: »

Another great thing about the Cooperative Credit Cards are that they donate £1.25 to charity for every £100 spent on the card.

EDITED: I think you'll find that it's usually 25p per £100 spend on their charity cards and 1.25p per £100 on the members card. Better to earn cashback at a higher rate and donate it directly to the charity of your choice via a Gift Aid top-up if a good cause is your thing.

jambosans

opinions4u wrote: »

I think you'll find that it's usually 25p per £100 spend. Better to earn cashback at a higher rate and donate it directly to the charity of your choice via a Gift Aid top-up.

It's even less than you suggest (link):-

Co-Op wrote:

We’ll donate 1.25p to our Customer Who Care campaign for every £100 you spend – at no extra cost to you.

Although I believe if you become a Co-Op Member (to apply for this credit card you must be anyways) you can automatically donate your dividend to charity with Gift Aid.

OP the Co-Op Members' Credit Card isn't too bad (it's mentioned on the guide o4u has linked). It really depends on your income bracket and the amount you spend on your card. For example, the AmEx Platinum Cashback Credit Card may be the best but requires a household income of £30k to be eligible to apply.

It's also worth nothing the Co-Op Members' Credit Card requires a minimum income of £10k to apply (not an issue, generally speaking, for those in full time work, but you mentioned being a student).

As for Co-Op as a whole, I like the idea, members not shareholders, and an ethical policy which relates to the bigger picture of banking (i.e. no immoral investments). I'm put off, like others, by their diabolical interest rates, archaic online banking service, and a poor Faster Payments implementation. There are other ethical banks out there, in particular for savings (e.g. Triodos) with better rates, but still not market leaders.

korrah80

I opened a smile bank account three years ago after banking with Halifax and I have not looked back! They are ethical, not just with their investments but also customers' debt.
I agree their savings accounts are not great compared to others but I suppose you have to decide what is more important...knowing your money is not funding murky organisations and bad debt or getting a few extra pence on your savings?
I have the smilemore bank account plus which is £13 a month but I get Green Flag breakdown and annual travel insurance and they offer additional 'bundles' that you can choose such as travel bundle, technology bundle etc that gives you further benefits. You also don't pay any interest on the first £500 of your overdraft, compared to £300 on a standard account.
I would recommend them to anyone...their service is second to none, they didn't go cap in hand to the government for a bailout and they treat you as an individual which is pretty rare with most banks

Danstar_2

I'm a student, I have a student account with Natwest, my student loan goes into here and an e-ISA. I moved my overdraft and half my loan into the e-ISA to earn some money on it.

I also have a Natwest Advantage Gold account with no overdraft as my main current account which is £13 a month for free car break down cover, £500 phone insurance to cover my iPhone and WORLD WIDE travel insurance. I also have a Natwest student credit card that I use for day to day spending and have the balance paid off monthly rather than my allowance into my bank.

I spend about £400 a month on it so I should be racking up a decent credit rating.

Also a student I'd recommend a part time job. I do 3 6hour shifts at £5.75 an hour a week in a restaurant plus tips so as a student you wont have the opportunity cost most students seem to have. Plus, if you pay it on a credit card and pay it off you will have a good credit rating and be able to go travelling in the summer with all the cash you have.

=D

premierfella

Scrub - duplicate post

glenn_m

I switched my main current account to them last year and they've been fantastic.

I don't have an overdraft but I once accidentally went overdrawn. I received a letter from them saying "we've noticed you've gone overdrawn without having an arranged overdraft. Please pay it back within a week to avoid any charges". :T
Whenever I've spoken to them over the phone the staff have been incredibly courteous.
I was a bit put off by their online banking at first, which on first glance appears to be very antiquated compared to other online banking sites. But I grew to appreciate that unlike other bank's websites, I don't need to dig through several different layers of menus in order to ammend a standing order etc.
My only minor gripes are that it would be nice to have the option to turn off paper statements, though I'm sure they'll implement this sooner or later, and it would be nice if their interest rates on their savings products were a bit more competitive.
All in all a big thumbs up.