Banking and Credit

From receiving loan instalments and wages to paying your bills, you’ll benefit from having your own bank account while you’re at University.

There is an enormous range of bank accounts available. It will depend upon your personal circumstances which accounts you are eligible to apply for. If you need to borrow money, consider all of your options and make sure you understand the contract you’re entering.

Direct debits and standing orders

You may find it convenient to pay your rent, fees and bills by direct debit. This is where you give permission to a company to take money from your bank account at an agreed frequency. You might choose to pay your utility bills by monthly direct debit, but you can also set this up to be paid quarterly depending on how you want to manage your budget.

A standing order is similar to a direct debit, except you tell your bank to pay a person or organisation, instead of the organisation taking money from your account. The biggest difference is that you are the only person who can make a change to a standing order. The organisation is unable to alter your payment.

Direct debits and standing orders are very handy because you can plan ahead and make sure you have enough money to get you through the term. They also reduce stress because you know you won’t miss an important payment.

Student bank accounts

Student bank accounts are like current accounts but tend to offer beneficial rates and terms to students in higher education. To open a student bank account you usually need to be over 18 and studying on a full-time degree course. How long you have been resident in the UK may also be considered, but this varies from bank to bank.

Students who wish to open a UK bank account may need a letter of introduction from the University to give to the bank when they apply to open an account. Normally only International students will need this letter, if you are a UK student a certificate of registration which you can produce from the S3P student portal will normally be sufficient to prove your status as a student. For more information on opening a bank account please read our arrival pages.

Overdrafts

An overdraft gives you the ability to withdraw more money than you have in your account. The bank allows you to borrow money from them when your money has run out.

Most student bank accounts will not charge you for borrowing this money, and will offer you an authorised and agreed interest-free overdraft limit.

Shop around

Student bank accounts are a very competitive business. Banks will compete for your business by offering freebies such as a Young Persons Railcard or discount cards. Incentives should not be a priority when choosing a bank account. Most students find the interest-free overdraft facility is more useful.

Some things to remember

never exceed the agreed overdraft limit, otherwise you will incur a charge
always check the interest rate and other charges for exceeding your agreed overdraft limit
never borrow more money than you need – you'll need to repay it after graduation
find out when the overdraft needs to be cleared – some student bank accounts want repayment of the overdraft soon after graduation; others will allow the interest free-overdraft to remain for a year after graduation

The way in which you manage your overdraft as a student can affect your credit rating.

Look for a bank that will allow the biggest interest-free overdraft for the longest period of time.

Compare accounts

To find the best bank account for you, take a look at comparison sites:

EU and international students

If you're an international student, it's unlikely that you will be able to open a UK bank account before you arrive in the UK and register at the University.

It can take several weeks to open an account. You need to make sure that you have enough money to cover your living costs when you first arrive in the UK. You might be able to open an international account from your home country. If you can, make sure that you will be able to withdraw cash from cash machines in the UK.

To open a UK bank account, you will usually be asked to provide:

your passport
confirmation of your local address
an original copy of your letter of acceptance from the University
proof of your address in your home country, although not all banks will ask for this

Students who wish to open a UK bank account may need a letter of introduction from the University to give to the bank when they apply to open an account. Normally only International students will need this letter, if you are a UK student a certificate of registration which you can produce from the S3P student portal will normally be sufficient to prove your status as a student. If you need a bank letter you can request from Student Services, Level 2, King’s Gate Building.

Shop around

Many of the UK major banks have local branches close to the University campus. Most UK banks usually offer a very basic service to international students. Shop around and compare what each bank can offer.

For reasons of personal safety, you should not carry large sums of money around, or keep large sums of money in your home.

Overseas banking and accessing money abroad

If you're on an exchange year or a placement overseas, you will need to think about the best way to access your money and avoid paying international transaction charges on a regular basis.

Every country has its own banking system and regulations. When you arrive at your destination:

ask local students or your employer for advice about local banking arrangements
find out what other students did during their exchange or placement

It might take a little while for you to open a bank account when you arrive at your destination. Make sure that you have enough money to cover your costs when you first arrive.

It is probably a good idea not to carry large sums of cash around. Look into the option of using a pre-paid travel card, which allows you to load the card up with money before you leave. Use a comparison site to check you are getting the best deal.

Before you head off, you should also speak to your UK bank to check:

whether it is possible to continue to use your UK bank account
the options for receiving and sending money overseas
what charges you will incur

The Money Advice Service and Money Saving Expert have more information about sending money abroad. You might also discuss the best ways of transferring money overseas with your family before you leave the UK, in case you experience financial difficulties and need cash in an emergency.

Credit

There are lots of different ways to borrow money. If you borrow money, you will usually have to pay it back with interest added to your loan.

Before you borrow money, make sure you can make repayments on what you borrow. If you’re in doubt, contact the Student Advice Centre.