Student banking services: choose an account that’s right for you | Student funding

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YesYoung people have struggled financially over the past two years. This means that it is all the more important for those going to college to make sure they have the right bank account for them.

You don’t have to have a student bank account – you can opt for a standard checking account – but those aimed at college students offer features you usually can’t get elsewhere.

Student bank accounts often come with a freebie or two, and this year is no exception. However, for many, the key feature is the size of the interest-free overdraft they offer.

“There are definitely some decent account benefits this year, but students should check the whole package before committing,” says Rachel Springall, finance expert at the Moneyfacts.co.uk website.

A lot will depend on how much you expect to have to borrow and what features and benefits you think you are actually using.

This year’s choice of the group – according to Martin Lewis’s MoneySavingExpert.com and the Save the Student website – is that of Santander 123 student current account.

The bank offers students an interest-free overdraft of £ 1,500 in years 1, 2 and 3, £ 1,800 in year four and £ 2,000 if you stay until year five. When you open this account you get an overdraft limit of £ 250, and to increase it to £ 1,500 you will need to sign up for online banking, pay £ 500 and continue to pay at least £ 500 each quarter. university.

There are other banks that offer potentially larger overdrafts – for example, HSBC says some people will be able to get up to £ 3,000 in their third year of study. However, the amounts advertised are often the maximum that is offered. Most banks use “up to” in the wording – that is, you might not get the full amount listed as it will depend on your credit rating – but Santander does not.

Save the Student says: “We think you’re more likely to get £ 1,500 from Santander than HSBC (which advertises £ 3,000) during your degree. ”

Santander also offers a pretty decent perk: a free four-year 16-25 rail card worth around £ 90, giving students up to a third off most rail fares. Additionally, the Spanish-owned bank topped the Save the Student banking survey earlier this year, with a student satisfaction score of 4.39 out of five. Barclays was second at 4.36, while Nationwide was third at 4.34.

On the uncovered front, HSBC says you can get an interest-free limit of up to £ 1,000 in your first year, which he says “could increase” to £ 3,000 in year three. As an incentive, he’s offering £ 80 in cash, plus either a £ 20 Uber Eats voucher or a year of unlimited next day delivery with Asos Premier (the latter normally costs £ 9.95). To take advantage of this offer, you must complete five debit card transactions within one month of opening your account.

at national scale The interest-free overdraft agreement is similar: in the first year you can get one for up to £ 1,000, and up to £ 3,000 in the third year. Its FlexStudent checking account does not come with a sign-up incentive, although one of the perks is that there is no charge for using your debit card at home. foreigner. You must pay at least £ 500 per quarter.

It’s not just HSBC giving out cash as a welcome gift: NatWest is offering £ 50 in cash plus a four-year tasting card – worth around £ 140 – which gets you two-for-one meals or 50% off food at thousands of restaurants. NatWest offers an interest-free overdraft of up to £ 2,000 regardless of the academic year you’re in, although it’s limited to £ 500 in the first trimester. To be eligible for its current offer, you must sign up for mobile or online banking and choose to receive paperless statements within 30 days of opening the account.

The Barclays This year’s giveaway is a free 12-month subscription to Perlego, an online library of academic and documentary titles, which normally costs £ 96. Its interest-free overdraft limits are up to £ 500 in the first term, up to £ 1,000 in the first year and up to £ 1,500 in the second year and beyond.

Digital banking Monzo is popular with many students, but does not offer a student bank account as such. Qualifying customers can get an overdraft of up to £ 1,000, but you will be charged interest for using it. Monzo charges 19%, 29% or 39% EAR, based on your credit score. For many people, banks like Monzo work well as a secondary account for day-to-day spending and budgeting.

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