Frequently Asked Questions

To open a bank account in the UK, you will typically need to prove who you are and where you live. A passport or driving license can prove your identity (although some banks will accept other forms of identification - check with them before applying), and a recent bank statement or utility bill can prove your address (although again, most banks will accept other documents as proof of identity). Some banks may require further documentation. Depending on the type of account you want to open, a credit check may be conducted. Most traditional high street banks will still require you to apply in person at a branch, while mobile only banks will require you apply online via their apps using a smart phone or website.

Bank account interest rates can refer to either credit balance interest rates, or debit balance interest rates. These vary by bank, with some banks charging or paying very little interest on credit and debit balances, and others charging or paying more. Check with your chosen bank to understand their interest rates and see what is best for your circumstances.

An overdraft is a lending facility that is attached to your bank account, that acts as a buffer to help you manage your daily spending. It is not intended to be a method of permanent lending, and the bank can withdraw its offer of an overdraft at any time. It is important to not treat this form of borrowing as “free money”, and to remember that you will usually be charged interest and arrangement fees on any overdraft facility that you use. These can be costly. The FCA has implemented caps or limits as to what banks can charge for customers for going overdrawn, these changes will take effect from April 2020.

An unauthorised overdraft happens when you go overdrawn without an overdraft being agreed beforehand or you exceed the agreed overdraft amount, but your bank allows the transaction to go through anyway. Overdrafts, and more particularly, unauthorised overdrafts can be costly. As a result, the FCA announced in 2019 that banks are to stop charging higher prices for unauthorised overdrafts. As of April 2020 the FCA expects overdraft borrowing costs to reduce to less than 20 pence a day per £100 borrowed. Also fixed daily or monthly charges will be banned. Your bank is under no obligation to provide overdraft facilities, this is always subject to status.

AER, or Annual Equivalent Rate, is the interest rate earned for savings accounts (in the same way that APR is the interest rate for credit).

If you want to switch bank accounts, your new chosen bank should be able to complete the process for you, often without you having to speak with your old bank at all. This can be dealt with by using the Current Account Switch Service or the Partial Switch Service. There will be several forms that you are required to fill out, and you may be required to prove your identity. The new bank will also run a credit check on you. Once all checks have been completed, you can then choose a date to move your account, which must be at least seven days in the future, and on a day when the bank will be open. The service to switch accounts is free, but you will be required to pay outstanding fees, if any, and new fees related to your new bank account.

Both people who want to open the joint account need to fill in the application form - either online or in branch - and provide proof of ID and address, very much the same as when opening a sole bank account. It is important that you trust the person you would like to open a joint account with, as you will be linked together financially, and the bank with run a credit check on both of you.