Can't Open a Bank Account

MoneyPennyPrincess

Hello savvy savers.

I need a bit of guidance in getting a bank account opened.
I have been lucky enough never to have had a mortgage or any loans which results in me being declined from opening a new bank account as I have no real 'Credit History'
I do have one existing account in excess of the £85k investor protection limit but want to diversify this risk with another account or two. I don't do internet banking but want a telephone operated account only.

Has anyone else had this problem and Does anyone know of a Bank or Building Society that would like my custom?

eskbanker

Why not open a savings account, where you won't be credit-checked in the way that you are for a current account (which can dip into the red)?

Many to choose from, see https://www.moneysavingexpert.com/savings/savings-accounts-best-interest/, although 'telephone operated only' may be a bit of a challenge....

atush

Are you on the electoral role?

Do you have utility bills in your name that you pay on time?

londoninvestor

Worst case, there are basic accounts that don't depend on credit history:
https://www.moneysavingexpert.com/banking/basic-bank-accounts/

However, it probably isn't just a matter of never having had a mortgage or a loan. It's pretty hard to get a mortgage or loan without a current account. So if you couldn't get a current account without a mortgage or loan, there'd be a giant catch-22 and a lot more people would have this problem...

PRAISETHESUN

I was in a similar situation when I first moved to the UK - I was unable to pass a credit check so was only eligible for a basic bank account. As long as you have suitable documentation to prove your identity and address (the banks differ in their requirements so it'd worth double checking with the bank ahead of time to see if you have document's they'd accept) you will be able to go. Monzo and Starling are two app-only current accounts I recommend to people in situations like yours - all you need is a passport (doesn't need to be a UK one) and a valid UK address where they can send your card to. Otherwise I'd talk to your local high street banks to see what they can offer you.

https://www.moneysavingexpert.com/banking/basic-bank-accounts/

As for getting a mortgage, you'll definitely need to start building your credit history up before banks will even consider touching you. There are several things you can do to start, but opening a current account and getting yourself on the electoral roll are two super helpful things. I'd look into getting a sub-prime credit card - ones designed for people with poor/non-existant credit history. The APRs are horrendous, but if you make a few purchases each month (just put purchases you'd usually already make on your credit card instead) and pay the balance off in FULL then the interest rate doesn't matter. Rinse and repeat for 6-12 months and you will have started to show you can be trusted with credit, leading to more mainstream lenders deciding they are happy to take a gamble and potentially offer you better deals. Some good links are below - but ignore any reference to your credit "score" - these numbers are mostly marketing gimmicks from the CRAs and are only seen by you - focus on building up your credit history with things lenders want to see!

https://www.moneyadviceservice.org.uk/en/articles/how-to-improve-your-credit-rating
https://www.moneysavingexpert.com/loans/credit-rating-credit-score/