What is a basic bank account?

With the changes to benefits next year it is now more important than ever that everyone has a bank account. As the name suggests they are very simple and are just a place to store money and pay out of. You will recieve a cash card for use at cash machines, but some do give you a debit card so you can make payments instores, online and have the ability to set up direct debits.

With most accounts you can:

  • have wages, salary, benefits, pensions and tax credits paid straight into your account
  • pay cheques in for free
  • withdraw money from cash machines and Post Offices
  • pay bills using Direct Debit
  • use bank counters to pay money in and check your balance

Who can open a basic bank account?

Apart from a couple of exceptions, anyone can get a basic bank account, even those with credit history problems - such as having been declared bankrupt in the past year. To open a bank account you should check with your local branch as you will need identification and proof of address. This will usually be accepted in the form of a passport, driving license or a recent utility bill.

Good reasons to open bank account

There are many good reasons to open a basic bank account such as:

  • Your money is asccessable 24 hours a day, 7 days a week
  • Wages, pension and benefit payments can be paid directly into the account even if there is a postal delay
  • Money will be available on the day it arrives in your account
  • You will receive discounts on utility bills if you pay by Direct Debit
  • You will have a cash card for use at cash machines

Remember to stress that you want to open a basic bank account. Do not feel pressured into opening another account which is unsuitable and may lead to future problems such as unauthorised overfrafts (for which you will be charged). To have housing benefit paid into your bank account you should contact your local housing benefit department.


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