Basic Bank Account Thread

PaulW922

A bankers draft is indeed guaranteed payment, but it still has to clear through the banking system, so the guy may not be able to actually get his hands on the cash until then - he just knows by taking a draft that he IS going to get it.

laura23_2

sgx.saint wrote: »

Hello All.

I thought I would start this thread in relation to all the posts that I see regularly on this board regarding Basic Bank Accounts.

The purpose of this thread is to answer questions, support and help those who are looking for a Basic Bank Account for whatever reason. Basic Bank Accounts are designed to do exactly what they say on the tin so to speak, serve the purposes of having a bank account, with none of the frills. Basic Bank Accounts will not come with any credit facilities, which probably wont come as much surprise.

Why would I want a Basic Bank Account?

The most common reason is that people with adverse credit histories (Defaults, CCJ's, Bankrupts) are usually unable to open a 'standard' bank account with any of the high street lenders. Basic Bank Accounts are designed to allow people in such circumstances to open and operate an account. In saying that, some banks are still very strict in their application criteria and people still are sometimes declined. It is a common misconception that banks have to provide an account to absolutely anyone. The FSA made strong recommendations to the banking industry that they provide an account to people who would normally not meet their standard eligability criteria, however at this stage they do not enforce this recommendation. So just like a nighclub, a bank has the right to refuse entry. Fear not though, as there are a large array of accounts available and you will almost certainly find one to suit your needs.

Of course Basic Bank Accounts are not just for people with adverse credit problems, as the accounts offer no credit facilities, some people prefer to use them as they feel they can manage their money better. People open them as second accounts to manage direct debits, a second account for 'Matched Betting' or even as a 'parachute' account if you are reclaiming bank charges from your current bank. So as you can see there are quite a few reasons you may want to open an account.

Links

I myself have two basic bank accounts, and a few months ago when I was 'shopping' around for the right basic account, this board proved invaluable. So I thought I would share my personal recommendations, advice and opinions to help others who too need a basic account. I use my Basic Accounts for Matched Betting and managing my array of Direct Debits, but of course they can be used for whatever purpose you require.

Moving on, I would direct all newcomers to the following two websites, which both list the majority of Basic Bank Accounts provided within the UK.

The first link is to the Financial Services Authority website and is a .pdf document that lists the various basic bank accounts, their features and also provides a little banking background information as well, such as terminology and so forth:

http://www.fsa.gov.uk/consumer/pdfs/bank_account.pdf

The second link I found very useful, this website provides a very good breakdown of the various accounts available including information about what type of card you will receive, i.e. Maestro, Solo, Cash Card. Also it even details the interest rates if applicable and if the accounts support Standing Orders or Direct Debits.

http://www.moneyfacts.co.uk/banking/bestbuys/banking_basic_bank_accounts.aspx

What do I need to open an Account?

To open a Basic Bank Account, the procedure is pretty much the same for any other account. When you have decided which bank to visit and apply for an account you will need two forms of ID and proof of address.

Usually you need a form of photographic ID, such as a Passport or Driving Licence. You will also need proof of address, this can usually be a Utility Bill or Council Tax Bill. Obviously do check with your bank first as this is just a general rule of thumb. Some Banks policies may differ slightly.

Also, a tip .... When you goto open a Basic Bank Account, make sure the person (Staff Member) who is opening the account is fully aware that you want a Basic Account. If possible mention the name of the account to be sure. A few members on here have been caught out where the bank staff have applied for a full current account and as a result the member has been turned away (only applicable to members with adverse credit histories).

Usually, even when applying for a Basic Account, a credit check is still performed. This is normally just to confirm your identity and your financial status. i.e. that you have'nt lied about being bankrupt etc. Some banks of course will accept bankrupt individuals (check the two websites for more information!).

CitiBank

Before we go any further, I have to mention CitiBank. CitiBank are a large international banking organisation with a signifcant worldwide presence. They originated in the USA and also have a large UK operational presence. CitiBank offer a current account package called the 'Sterling Current Account'.

Why is he mentioning this I hear you cry!

There has been a lot of discussion on this board over the past three months regarding this account as CitiBank appear to have a very flexible eligability criteria for the account. Many members have successfully opened an account even with adverse credit histories. I therefore highly recommend trying to open a CitiBank account before continuing down the route of a Basic Bank Account. This account is a full account, and even offers £500 interest free overdraft and chequebook (if your eligable) and even if your not, most people are still able to open the account, complete with Visa Debit Card. Many of the features I just mentioned are not available on Basic Accounts so I again urge you to try and apply for this account first before continuing.

--
http://www.citibank.co.uk
--

I won't go into much more detail here, but there is an ongoing thread you can join here:-

http://forums.moneysavingexpert.com/showthread.html?t=321204

Basic Account Recommendations

My two personal recommendations for Basic Accounts are:-

Yorkshire Bank - ReadyCash Account. http://www.ybonline.co.uk

&

Natwest Bank - Step Account. http://www.natwest.co.uk

Both accounts I find to suit my needs brilliantly and the accounts are in my opinion superb. But of course everyone is different.

A recent thread started on this board (I can't find it at the moment) also suggests you can try opening an account with your local Credit Union if they do indeed provide an account. You could try searching for this thread if your interested in exploring this route.

I will of course link this thread when I find it for a better explanation of Credit Unions.

I hope this thread goes a long way to answering your questions and helping you locate the right account for you.

Thanks

SGX Saint

Thanks you have given me alot of info. Only I need some help.
I have a basic account with the halifax and I get paid weekly by cheque. It takes 10 days to clear, which is far to long. I have asked them to change my account to a current account but they said no because I had bad credit with another bank that was cleared 5 years ago. please can someone give me some advice. ive applied to other banks but I was refused. I cant keep on waiting 10 days for my money every week.

Tori_Bellatrix

laura23 wrote: »

Thanks you have given me alot of info. Only I need some help.
I have a basic account with the halifax and I get paid weekly by cheque. It takes 10 days to clear, which is far to long. I have asked them to change my account to a current account but they said no because I had bad credit with another bank that was cleared 5 years ago. please can someone give me some advice. ive applied to other banks but I was refused. I cant keep on waiting 10 days for my money every week.

As far as I know the Cashminder basic account by The Co-op clears cheques in 3 days.

Hapless_2

Hi all, a bit of a newbie to all this. I have just applied for a citibank account after my basic account from the HSBC was closed due to a refused standing order! I have an Abbey basic account but they will NOT allow a standing order for my rent payments!
There are still people out there who cannot get a basic bank account at all. Even if they are working full time and never been bankrupt.

As for chip and signature, under the disability discrimination act if you have a debit card you are entitled under law to request chip and signature as opposed to chip and pin and shops who refuse to accept chip and signature are also breaking the law.

Hapless_2

Oh cashminder takes cheques paid in at the post office but it is a 6 day clearanceCitibank lower end account is now called the Access account, sterling account is changing to plus account with a £10 monthly charge.

Nimo_2

2nd May STILL waiting on PIN for clydesdale Reasycash account, and The internet banking staff are less than useless, they won't sent out my activation code to use the service because "Road" is spelt "Raod" and it takes a week for the Branch to update they're computer system. I would have thought in this day and age they'd all be working off the same computer system or have some sort of formal link with each other; Failing that be able to spell junior school words.

Nimo_2

Hapless wrote: »

Oh cashminder takes cheques paid in at the post office but it is a 6 day clearanceCitibank lower end account is now called the Access account, sterling account is changing to plus account with a £10 monthly charge.

Hi you can set up the standing order yourself on an abbey basic account through the internet banking, click on "Regular Transfers" on the left hand side and then select "Set up regular transfer" and fill in the details.

Has anyone had any success upgrading they're abbey basic account to a full one, I have an appointment tomorrow to see if they will allow me to have a debit card, i don't care what kind it is as long as i don't have to run to the cash machine every time i want to spend £1:rotfl:

Nimo_2

Hapless wrote: »

Hi all, a bit of a newbie to all this. I have just applied for a citibank account after my basic account from the HSBC was closed due to a refused standing order! I have an Abbey basic account but they will NOT allow a standing order for my rent payments!
There are still people out there who cannot get a basic bank account at all. Even if they are working full time and never been bankrupt.

As for chip and signature, under the disability discrimination act if you have a debit card you are entitled under law to request chip and signature as opposed to chip and pin and shops who refuse to accept chip and signature are also breaking the law.

Hi you can set up the standing order yourself on an abbey basic account through the internet banking, click on "Regular Transfers" on the left hand side and then select "Set up regular transfer" and fill in the details.

Has anyone had any success upgrading they're abbey basic account to a full one, I have an appointment tomorrow to see if they will allow me to have a debit card, i don't care what kind it is as long as i don't have to run to the cash machine every time i want to spend £1:rotfl:

Hapless_2

Nimo wrote: »

Hi you can set up the standing order yourself on an abbey basic account through the internet banking, click on "Regular Transfers" on the left hand side and then select "Set up regular transfer" and fill in the details.

No they are refusing to do it they are also refusing to set up direct debits for us. When I contacted them about it I was told that they have the right to remove the priviledge of dd and SO.

Nimo_2

Dont know what they're playing at Hapless, maybe you'd be better off with another basic account elsewhere, I mean your paying the same charges as everyone else why should you be 2nd class.

On a different note, I went in today and asked for my basic account to be upgraded to a full one, the man went away for 5 mins and came back and said OK no problem your debit card and cheque book will be in the post in about 3 weeks.

....Result.