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Student Bank Accounts

Grab the top overdrafts and freebies in 2015/16

Best Student AccountsRailcards, 0% overdrafts and discount cards; banks love reeling new students in with goodies, and they're getting competitive. This is a guide to bagging the best deal, whether you're a fresher or just refreshing finances.

The accounts in this guide are 2015/16 accounts, and are open to any students currently studying - so, if you've already got an account, why not see if you can switch to a better deal?

The student account need-to-knows

  • Get the biggest 0% overdraft - unless huge freebies beat it

    Student accounts are simply bank accounts made for those in higher education. They let you pay money in and out, and offer additional benefits such as an interest-free overdraft and a debit card.

    2

    Most students need an overdraft, where the bank lets you spend more than you've got (at no extra cost) to a set amount. Aim to get the biggest and longest guaranteed 0% overdraft - the only time this doesn't apply is if the freebie on offer is so valuable to you it outweighs this.

    Be wary of banks offering bigger overdrafts than our top picks - some give 'guaranteed' amounts, others 'up to' amounts - so make sure you're comparing like for like. However, you must ask for extensions each year, even on guaranteed limits - they're not applied automatically.

    Quick questions

    When can I open a student bank account?

    Do you have the right ID to open an account?

    I'm an existing student. Can I switch to a different bank account?

  • Never go over your overdraft limit

    This isn't a rule just for students, it's a rule for life. The game totally changes if you go beyond your overdraft limit - charges shoot up and you can be caught in a vicious cycle that's tough to ever escape from. If you stay within your limit there's usually NO COST.

    If you're struggling, at least talk to the bank. Try to agree an extension but remember, you are likely to be charged interest, up to a huge 24% EAR. It's always far better to plan and budget to avoid this.

    If not, or if you go over without permission, the charges can be enormous - up to £25 per transaction (so a shopping trip spending £30 in five debit card transactions could see you facing £125 of charges) - beware! More info in Bank Charges Compared.

    Quick question

    What is an overdraft?

  • Beware, you'll be credit scored

    When you apply for debt products, including a bank account with an overdraft, the bank will credit score you to decide how desirable a customer you are based on behavioural predictions from your previous financial data.

    As a student, it's likely there'll be very little data on you, which makes credit scoring very difficult. Sadly this can leave some students rejected due to ridiculous anomalies, and there may be no rhyme, reason or solution to this. Read the Credit Scoring guide for more info.

  • DON'T pick based on the closest branch or ATM

    Just because there's a particular bank on campus, or a conveniently-located cash machine nearby, it DOESN'T mean you should choose an account with it.

    You can withdraw cash free of charge from any bank's ATM and almost every bank gives online access. Branch location has little relevance for able-bodied students. 1To compare, examine what's on offer and go for the best deal.

  • After uni, switch to a top graduate account

    Your aim straight after uni should be to pay down your 0% overdraft. If that's not possible, for at least a year after finishing your course, you're still eligible for preferential terms, including 0% interest overdrafts, allowing you to gradually pay off the debt.

Best buys: top student accounts

The high street banks compete in a red-hot battle. They publish ever bigger overdraft limits, but then sneakily won't allow all students to have them. The key is whether the overdraft is 'guaranteed' or 'up to' - the latter means you'll only get it if you have a good credit record, and all accounts require you to pass a credit check.

Santander

Free 4-yr railcard & decent 0% overdraft

Santander*

Santander* gives accepted new 123 Student Current Account holders who pay in £500/term a four-year 16-25 Railcard. This is also available to full-time students aged 26 and over. Worth about £90 (we valued it against a three-year railcard which normally costs £70 as four-year cards aren't available for general purchase), it gives a third off most rail journeys.

You'll also get an 'up to £1,500' 0% overdraft for three years, though this amount is judged on a case-by-case basis, and up to £2,000 if your course stretches to five years. You could switch to another account with a bigger overdraft after your first year and keep the railcard, as you get it within three weeks of account opening.

Please let us know your experiences and any problems: Santander feedback, but in general we haven't heard many complaints.

Need-to-knows
  • You automatically get a £250 overdraft when you open the account, then up to £1,500 in year one to three if you make the £500/term pay-in.
  • It goes up to £1,800 in year four and £2,000 in year five, if your course is that long.
  • The overdraft limits aren't guaranteed but most accounts usually get close to them.
  • Santander shares its £85,000 UK savings safety guarantee with Cahoot, so don't hold more than £85,000 across the two banks.

How Santander rates on service

73% great

22% okay

5% poor

Date: Feb 2015 Voters: 11,935

Stats box
  • In-credit interest: 1% for £100+, 2% for £200+, 3% between £300 and £2,000
  • Arranged overdraft cost: No fees
  • Unarranged overdraft fees: £5 daily charge (max 10/month), paid/unpaid fees: £5/£10 per item
  • 0% ' overdraft: Years 1-3: Up to £1,500. Year 4: Up to £1,800. Year 5: Up to £2,000.
Key questions

How do I get the railcard? To get the railcard, you'll need to open a Santander 123 Student Account for the first time and make the £500/term pay-in. You must register for online banking, which will take 7-10 days to set up, then enter a special code for the railcard website, which is valid for 60 days ONLY. Make sure you enter the code within the time-frame, as they won't issue you another code.

Can I get the railcard if I'm in Northern Ireland? Unfortunately the railcard isn't valid in Northern Ireland, although the overdraft still makes it a decent option.

What should I avoid with this account? Go into an unauthorised overdraft, and the fees are huge, so avoid at all costs. Arranged overdrafts aren't permitted above the set limits.

How can I give feedback on this account? Please let us know your experiences and any problems: Santander feedback.

Co-operative Bank

Big year one 0% overdraft with good chance of getting the max

Co-op Bank

The Co-operative Bank has got strong - but not the overall biggest - 0% overdraft limits of £1,400 in year one, £1,700 in year two and £2,000 in year three, plus it consistently scores well in our customer service polls. Unlike the banks below which shout about huge £3,000 limits, Co-op's told us 90% of successful applicants will get the full amounts advertised.

Need-to-knows
  • If you pay in your student loans, and don't incur charges, plus you must ask for the increases at the beginning of each year.
  • Please tell us if you get the full 0%.

How Co-op Bank rates on service

72% great

21% okay

7% poor

Date: Feb 2015 Voters: 11,935

Stats box
  • In-credit interest: None
  • Arranged overdraft cost above 0% limit: 9.9% EAR
  • Unarranged overdraft fees: 18.9% EAR plus £15 unpaid item fee (max £150 per quarter)
  • 0% overdraft: Year 1: £1,400 Year 2: £1,700 Year 3: £2,000
Key questions

I've heard a lot about Co-op Bank - lots of scandals. Is it unstable? We have to highlight recent scandals, solvency worries and the fact it's now 70% privately-owned.

You need to decide where you stand on the self-proclaimed ethics of the bank, but the key fact on solvency is the first £85,000 of savings per person in the combined group (Co-op Bank, Smile, Britannia) is guaranteed by the Government-backed FSCS. This includes money in your student account (if you're lucky enough to have some). For how this works, see the full Savings Safety guide.

What does it cost to go over overdraft limits? Any agreed borrowing over the limit costs an OK 9.9% APR. But it jumps to 18.9% plus big charges on top for unarranged borrowing, so don't do it.

Can I get a graduate account? The Co-op doesn't have an official graduate account. You can keep the student 0% overdraft for a year after graduation, but other graduate accounts are likely to beat it.

HSBC

Joint highest 'listed' max 0% overdraft + free £60 Amazon voucher

HSBC

The HSBC account gives a free £60 Amazon gift card when you open the account - a good alternative if you don't think you'll use the railcard Santander offers. It also shouts loudly about a maximum interest-free overdraft of up to £3,000, but feedback tells us it's often only up to £1,000 by the end of year one.

Need-to-knows
  • If accepted, you'll initially get just £500. You must then ask for further increases, but you won't be guaranteed to get the full amount.
  • As an added bonus, the account pays 2% interest on the first £1,000 credited, but only in your first year of study.
  • We welcome your feedback, detailing if you were accepted and the overdraft limit you were offered.

How HSBC rates on service

43% great

41% okay

16% poor

Date: Feb 2015 Voters: 11,935

Stats box
  • In-credit interest: 2% AER on balances up to £1,000 in the first year only
  • Arranged overdraft cost: Can only borrow up to £3k
  • Unarranged overdraft fees: No fees
  • 0% overdraft: £500 initially, then up to £3,000 (not guaranteed)
Halifax

Joint highest 'listed' max 0% overdraft

Halifax

The Halifax student account gives overdraft limits of 'up to' £3,000, though only the first £1,000 is guaranteed - the rest is decided on a case-by-case basis. You can ask for increases from what you're given, but previous year's feedback was it's unlikely to go higher than the initial £1,000 in year one.

Need-to-knows
  • Never, EVER go over the interest-free limit, or you'll be stung with huge rates up to 24.2% AER plus a monthly fee of £28, and returned item fees of up to £10.
  • If you apply for this, please let us know the size of the overdraft you get in the forum's Halifax feedback thread.

How Halifax rates on service

57% great

33% okay

10% poor

Date: Feb 2015 Voters: 11,935

Stats box
  • In-credit interest: 0.1% AER
  • Arranged overdraft cost: 7.2% EAR
  • Unarranged overdraft fees: 24.2% plus monthly fee of £28 and £10 returned item fee.
  • 0% overdraft: All years: £1,000 initially, up to £3,000 (not guaranteed)

Tool: compare ALL student accounts

Ten high street banks offer student accounts, each with varying overdraft limits, incentives and terms & conditions.

We've compiled a list here, which allows you to compare three accounts at the same time. You can compare different aspects of the accounts - eligibility criteria, 0% overdraft size, freebies, unauthorised overdraft interest rates & more.

This tool's both for new students starting in 2015/16, and for students already at university. If you already have a student account, it's worth checking each year if there's a new account that would suit you better. If so, ditch & switch.

Compare student accounts Compare up to three at a time below

2015/16 student account details
Eligibility criteria (and minimum age)
You must be 17 or over, have lived in the UK for the past three years and be studying on a full-time course that's at least two years long, or be on a one-year access course leading onto a full-time degree.

In full-time higher education in the UK, over 18 years of age, studying for a degree, equivalent (for at least two years), or post-graduate course for a minimum of 12 months.

You must pay your main source of funding into the account and provide evidence of study i.e. a letter from UCAS, your university, or the Student Loans Company, or a valid student ID card.

UK citizen or UK resident for at least 3 consecutive years. Over the age of 17 and a half, and in full-time higher education. Proof of funding is required (can be a letter from parents, or Student Loans Company). Must make an initial deposit of £300 to activate the overdraft.
At least 18 years old and resident in UK. Must have a confirmed place at a higher education institution for a degree or HND course. Must pay at least £500 into the account each term.
Minimum 18 years old, studying full-time at degree level or equivalent. Letter of confirmation from university is required.

Min age 17, resident in UK/Channel Islands/Isle of Man for at least 3 years, must not hold any other student account. Must have proof of entry onto full-time higher education course.

A restricted account is available if you don't yet have confirmation of your course. It will be upgraded to the full student account when you show your proof of entry.

You must be 17 or over, have lived in the UK for the past three years and be studying on a full-time course that's at least two years long, or be on a one-year access course leading onto a full-time degree.
1st year undergraduate Student Accounts are available to both UK & International students who are completing:
(a) a full-time undergraduate higher education course of at least two years' duration; or
(b) a full-time postgraduate course, at a university or college of higher education in the UK.
Unconditional letter of acceptance required as proof of student status.
1st year undergraduate Student Accounts are available to both UK & International students who are completing:
(a) a full-time undergraduate higher education course of at least two years duration; or
(b) a full-time postgraduate course, at a university or college of higher education in the UK.
Unconditional letter of acceptance required as proof of student status.
You must be 17 or over, have lived in the UK for the past three years and be studying on a full-time course that's at least two years long, or be on a one-year access course leading onto a full-time degree.
Minimum interest-free overdraft limits
Year 1
£1,500 tiered in the first year:
£500 for the first 6 months,
£1,000 in months 7-9,
£1,500 after that.
£500 automatic overdraft upon opening and up to term one, up to £1,000 in term two, up to £1,500 in term three.
£1,400.
£1,500.
£1,000 on opening. Then up to £3,000.
Guaranteed £500 upon opening. Then decided on a case by case basis for amounts up to £3,000.
£1,500 tiered in the first year:
£500 for the first 6 months,
£1,000 in months 7-9,
£1,500 after that.
Up to £2,000, tiered by term; £500 limit in first term,

£2,000 limit from second term.
Up to £2,000, tiered by term; £500 limit in first term,

£2,000 limit from second term.
£1,500 tiered in the first year:
£500 for the first 6 months,
£1,000 in months 7-9,
£1,500 after that.
Year 2
Up to £1,500.
Up to £2,000.
£1,700.
£1,500.
Up to £3,000.
Up to £3,000.
Up to £1,500.
Up to £2,000.
Up to £2,000.
Up to £1,500.
Year 3
Up to £1,500.
Up to £2,000.
£2,000.
£1,500.
Up to £3,000.
Up to £3,000.
Up to £1,500.
Up to £2,000.
Up to £2,000.
Up to £1,500.
Year 4
Up to £2,000.
Up to £2,000.
£2,000 (graduate).
£1,800.
Up to £3,000.
Up to £3,000.
Up to £2,000.
Up to £2,000.
Up to £2,000.
Up to £2,000.
Year 5
Up to £2,000.
Up to £2,000.
N/A.
£2,000.
Up to £3,000.
Up to £3,000.
Up to £2,000.
Up to £2,000.
Up to £2,000.
Up to £2,000.
Interest-free average
3-year course
£1,500.
Up to £2,000.
£1,700.
£1,500.
Up to £3,000.
Up to £3,000.
.
£1,500.
Up to £2,000.
Up to £2,000.
£1,500
 
5-year course
£1,700.
Up to £2,000.
N/A.
£1,660.
Up to £3,000.
Up to £3,000.
£1,700.
Up to £2,000.
Up to £2,000.
£1,700.
Interest-free limits guaranteed, or case-by-case?
No, decided case by case.
Subject to application and status.

Not guaranteed.

The first year £1,400 overdraft is guaranteed once the initial £300 deposit has been made. Overdrafts for 2nd, 3rd and 4th year are judged on a case by case basis.

Not guaranteed, assessed on individual basis.

£500 from your student loan or grant needs to be paid in each term to keep the overdraft facility.
£1,000 guaranteed on account opening. Further increments will need to be applied for.

Credits of £500 per quarter will be required to consider extending an overdraft.

Overdraft limit will be increased over time and based upon account conduct.
Guaranteed at least £500 upon account opening. All overdraft requests are subject to status and are assessed on an individual basis.
No, decided case by case.
Not guaranteed. The maximum in first year is normally given. To remain eligible for the overdraft, you'll need to use it as a main current account by
depositing at least £750 every six months, and making at least three debit transactions every month.
Not guaranteed. The maximum in first year is normally given. To remain eligible for the overdraft, you'll need to use it as a main current account by depositing at least £750 every six months, and making at least three debit transactions every month.
No, decided case by case
Agreed overdrafts beyond the 0% limit
£10 buffer, then a £6 monthly fee and 8.21% EAR.

Fees will only be charged if overdraft extends beyond £2,000 limit.

Go over £2,000 and you'll be charged £1 per day. You can only use up to £3,000 of your overdraft.

9.9% EAR.
0%.
No charge if amount falls under £10 buffer. 7.2% EAR for sums over £3,000.
N/A, you can only borrow up to £3,000.
£10 buffer, then a £6 monthly fee and 8.21% EAR.
0%.
0%.
£10 buffer, then a £6 monthly fee and 8.21% EAR.
Unauthorised overdraft rates and fees
8.21%
£10 buffer and a grace period until 3.30pm to pay and avoid overdraft fees.

Monthly fee: £6. Returned item fee: £10.
Daily fees:
Up to £10 - no charge.
Up to £25 - £5.
Over £25 - £10.

N/A, you can only use up to £3,000 of your overdraft. Go over your £2,000 overdraft and you'll be charged £1 a day.

Unpaid item fee: £8 per day (max one per day).

18.9% EAR.

Unpaid item fee: £15

£5 per day, max 10 days per month.

Paid item fee: £5

Unpaid item fee: £10.

24.2% EAR for sums over £3,000.

£28 monthly fee for unauthorised overdraft usage.

Unpaid item fee: £10 max a day.

N/A, you can only use up to £3,000.

8.21%
£10 buffer and a grace period until 3.30pm to pay and avoid overdraft fees.

Monthly fee: £6. Returned item fee: £10.
Daily fees:
Up to £10 - no charge.
Up to £25 - £5.
Over £25 - £10.
0%

Unpaid fee: £6 per item greater than £6 (max £60 per charging period).
0%

Unpaid fee: £6 per item greater than £6 (max £60 per charging period).
8.21%
£10 buffer and a grace period until 3.30pm to pay and avoid overdraft fees.

Monthly fee: £6. Returned item fee: £10.
Daily fees:
Up to £10 - no charge.
Up to £25 - £5.
Over £25 - £10.
In-credit interest rate
0%.
0%.
0%.
1% interest on balances up to £500, 2% if balance is £200+, or 3% for balances from £300 up to £2,000.
0.1%.
2% interest paid on balances up to £1,000 in the first year of study. No in-credit interest for further years of study.
0%.
0% .
0%.
0%.
Can you transfer from other banks and get this year's deal?
Yes. This will be based on the year of their study.
Yes.
Yes, the overdraft will be in line with your year of study.
Yes, if you're in your 2nd year or above, you can switch your existing student account to Santander using its account transfer service for a guaranteed £250 interest-free overdraft. Once the account's been credited with £500, the correct level of overdraft will be given.
Yes. Overdraft will be based on personal circumstances.
Yes it's open to new customers as long as they are starting their first year on a qualifying course. You cannot transfer to this account if you're past your first year of study.
Yes. This will be based on the year of their study.
Yes, but they won't be eligible for the free incentives (unless in 1st year). Overdraft limit is based on year of study.
Yes, but they won't be eligible for the free incentives (unless in 1st year). Overdraft limit is based on year of study.
Yes. This will be based on the year of their study.
Do the T&Cs stop you opening a student account elsewhere?
Yes.
Yes.
Yes.
No, but you can't have more than one Santander current account.
Yes.
Yes.
Yes.
No, but must use the account as main bank account. NatWest reserves the right to remove 0% overdraft rate.
No, but must use the account as main bank account. RBS reserves the right to remove 0% overdraft rate.
Yes.
Anything else?
N/A.
N/A.
They don't offer a graduate account, so the overdraft facility (up to £2,000) will extend.
If you're over 25 years old and in full-time education, you can still get a Santander 16-25 railcard.
N/A.

Fee-free student credit card with a limit of £500 (APR 18.9%).

Login via HSBC's Student Exclusives website and you'll get discounts on major brands such as Apple, Krispy Kreme and Lonely Planet.

N/A.
International students are not eligible for the overdraft.
International students are not eligible for the overdraft.
Account is currently described as for those opened from 1 August 2014. TSB has confirmed that there will be no change to the 2015 account when it is released.

Ten high street banks offer student accounts, each with varying overdraft limits, incentives and terms & conditions.

We've compiled a list, which allows you to compare three accounts at the same time. We've created a special page to house the Compare All Student Accounts tool which is not mobile optimised but still allows you to fully use it (don't worry, we're working on making it optimised so it can sit on this page and look beautiful).

With it, you can compare different aspects of the accounts - eligibility criteria, 0% overdraft size, freebies, unauthorised overdraft interest rates & more.

This Compare All Student Accounts tool's both for new students starting in 2015/16, and for students already at university. If you already have a student account, it's worth checking each year if there's a new account that would suit you better. If so, ditch & switch.

Do a budget the right way

It's a mantra parents push at their student offspring all the time. "You've got to do a budget young Johnny, it'll all go to hell if you don't, please do it Johnny, please..."

Yet "do a budget" is a meaningless phrase unless you understand your income.

work

With people who work it's an easy message:

You shouldn't spend more than you earn.¯


study

But when it comes to those going to university, you need to:

Add up student loan + grants + employment earnings + money from family, and that is your income. ¯


While 0% overdrafts are very useful and should help with cash-flow issues while you're a student, they're never part of your income. Always remember, an overdraft is a LOAN and must be repaid (its rate will jump once you graduate).

But if you're going to university next year or are currently studying, funding is key. Make sure you're aware of the loans and grants available to you and plan accordingly. See our Student Loans 2015/16 guide for more on fees and funding.