This fact sheet explains why you might consider opening a basic bank account. This can be particularly helpful if you have some debts with the same bank as you currently pay income into and you cannot pay. This fact sheet has a list of basic bank accounts that you could apply for. The list compares some standard features of basic bank accounts to help you choose which account might be best for you.
the Current Account Switch Service
Most banks have a guarantee that will let you switch accounts within seven days. This is called the Current Account Switch Guarantee. Banks will also guarantee your payments in and out of your new account are switched over in time so that you do not miss any regular bills and payments.
If you owe money to your bank or building society, it is important to make sure that any income, for example your wages or benefits, do not go into that account. This is because in some circumstances, banks and building societies can take money from your account to pay off your debt to them. This may leave you with too little money to live on, or to pay your essential bills. A basic bank account is a simple type of account that lets you pay money in and take it out, but doesn’t usually offer things like an overdraft or a cheque book.
Basic bank accounts are useful because your credit score does not usually matter. This means you should still be able to get a basic bank account even if you have lots of debt or a county court judgment, and in some cases, if you are bankrupt.
The rules about when banks can take money from business accounts to pay a debt to them can be very different compared to personal accounts. If you have a business account, contact Business Debtline on 0800 197 6026 or see www.businessdebtline.org.
The Money Advice Service has lots of useful information on its website on how to open an account, including what identification you will need and things you should think about. See www.moneyadviceservice.org.uk or phone them on 0300 500 5000.
The Financial Conduct Authority's Banking: Conduct of Business Sourcebook says that, if the lender has a basic bank account available, you should be told about it if you meet their rules. They should also tell you why you have been turned down. If this does not happen, you may be able to complain to the Financial Ombudsman Service. Contact us for advice.
You can use the following list of basic bank accounts to help you choose the right account for you. If you have any problems, contact us for advice.