- Opening a bank account
- How to switch bank accounts
- Switching bank accounts if you have an overdraft
- How to close a bank account
- If things go wrong
Opening a bank account
Choose a bank account
First, make sure you know what bank account you’d like to open.
How to open a bank account
Now that you know what bank account you want, it’s time to speak to the bank.
You can do this in branch, over the phone or online.
The bank will run a credit check to find out your credit history. This will tell them if you’ve had problems with paying back money in the past. If you have, you might not be able to open some types of account.
You’ll also be asked to provide proof of identity and proof of address.
How do you prove your address or identity? Here are some of the common documents banks and building societies will be looking for so you can prove you are who you say you are:
- Driving Licence
- Council Tax bill
- UK utility bill like gas or electricity
- Bank or building society statement
- Credit card statement
- HMRC letter or tax statement
- Mortgage statement
- Tenancy agreement
- Benefits statement.
Different banks will ask for different forms of ID. You can check online what ID you’ll need, so you’re be prepared to open your new account.
Fee-free basic bank accounts
If banks turn you down for a standard account, you can always apply for a fee-free basic bank account.
These accounts don’t charge fees or offer overdrafts. They also won’t charge you if a Direct Debit fails.
Or, take a look at our collection of guides, tips and handy links to make sure you get the best deal.
How to switch bank accounts
Almost all banks and building societies now offer a free seven-day Current Account Switch Service.
It’s backed by a guarantee that means you’ll be refunded any interest and charges on your old and new accounts if anything goes wrong.
During the switch process, you’ll be asked about your current overdraft. As long as you can prove your overdraft limit, for example with a bank statement, your new account might match your current limit.
How to choose a current account
Comparison websites are a good starting point for finding a current account that gives you everything you need.
You can start by thinking about some basics.
- You’ve often got money in your account - look for an account with a high interest rate to increase your savings.
- You’re often using your overdraft - look for an account with lower overdraft rates. Here are some tips for controlling your overdraft.
You can also then look at other features of accounts. For example, do they offer linked higher interest savings accounts, cashback or switching bonuses?
We recommend the following websites for comparing current accounts:
- Go Compare
- Money Saving Expert
- Which? – You can use the Which? quality rating to find the banks with the best customer score.
In Northern Ireland, you can also try the Consumer Council Comparison Tool.
Switching bank accounts if you have an overdraft
You can switch using the Current Account Switch Service even if you have an overdraft. The service will:
- Switch your current account.
- Move money from your old current account to your new one or if you’re in your overdraft it can move it into the new current account.
- Move all your payments going out (for example your Direct Debits and standing orders) and those coming in (for example benefits or salaries) to your new account.
- Close your old account.
- Make sure any payments accidentally made to your old account will be automatically redirected to your new account.
Your overdraft will need to be agreed with your new bank or building society for it to be switched. Alternatively, they may be able to offer you a way of helping you pay off your overdraft instead.
If this isn’t possible, you’ll need to repay your current overdraft before you switch.
The switching service takes seven working days. And if something goes wrong, you’re covered by the Current Account Switch Guarantee. This means you’ll be refunded any interest or charges you get as a result of any problem with the switch.
What do I need to be aware of when trying to switch with an overdraft?
It’s up to the new bank or building society to decide if they accept your overdraft, and different providers have different rules. They may turn you down if you have a very large overdraft or have been in it for a long time.
The decision depends on lots of different things. For example, if you’ve used an overdraft before, and have always paid it off, this sends a good signal to your new bank or building society. It shows you’ve been able to pay off debts in the past.
When you find a better account, speak to the account provider to find out if you can get it.
Bear in mind that your credit score is a factor when switching accounts. You’re more likely to get the account you want if you have a good credit score.
Even if you can’t get the new account you wanted, you should shop around to find a loan with better rates than your current account.
How to close a bank account
You can close most bank accounts whenever you like without being charged.
It’s usually just a case of getting in touch with your bank.
However, if you’re overdrawn you’ll have to pay off what you owe.
If you’re not using the Current Account Switch Service to shut your account, make sure any Direct Debits or payments are transferred to your new account.
If your bank decides to close your account
If your bank decides to close your current or instant access savings account, you’ll usually be given two months’ notice.
For other accounts, it must give you ‘reasonable notice’, so that you can make other arrangements. This should be at least 14 days.
The bank can delay the closure if you’ve made payments that haven’t left your account yet. For example, a cheque or card payment.
If things go wrong
If you’re unhappy about something your bank has done, the first thing to do is to talk to someone at the bank about it.
This article is provided by the Money Advice Service.