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No Credit Check Bank Account: What You Need to Know

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A bank account is essential for managing finances and staying on top of our financial commitments in today’s fast-paced and global environment. However, sometimes opening a bank account can be difficult.

In this article, we will explore the world of no-credit-check bank accounts, uncovering how they work, who they cater to, and the benefits they offer.

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Basic bank accounts with no credit check

Basic bank accounts are sometimes known as no credit check bank accounts. Many UK banks usually offer them without a monthly account fee. It provides access to online banking and a debit card even if you have no or a bad credit history.

With a basic bank account you can deposit money, get paid, pay bills, and withdraw cash at ATMs. However, they typically do not come with overdrafts or other perks.

You may opt for a basic bank account if you cannot pass credit checks due to current or previous debts or lack of credit history in the UK.

Moreover, most high street banks and some building societies offer basic bank accounts.

What can you do with a basic bank account?

Basic bank accounts offer several useful features though they come with some limitations. Basic bank accounts may provide a money card or the option to set up direct debits. However, they do not allow overdrafts, and you won’t receive a chequebook.

Despite the limitations, fee-free basic bank accounts provide valuable services:

  • Accepting wage, benefit, and other income deposits
  • Free money and cheque deposits (excluding foreign currency)
  • Money withdrawals over the counter or from cash machines
  • Regular payments through direct debits or standing order
  • Checking account balances at various points like the counter, ATMs, online, or on your mobile
  • Using a debit card for shopping both in physical stores and for online banking.

Note that while most basic bank account services are free, fees might be associated with specific cash points or using your card abroad.

Benefits of a basic bank account

The lack of access to a conventional bank account may be devastating financially, which is why basic bank accounts are so important.

The key benefit of these accounts is the convenience of accessing various financial services. You can pay bills or make regular payments through direct debit.

Additionally, it includes online and mobile banking, SMS notifications, contactless debit card, and compatibility with mobile payment systems like Apple Pay, Google Pay, and Samsung Pay.

Whether these features are available to you depends on the bank you choose.

In addition to the various banking features, a basic current account can help you improve your credit rating. Eventually, you can switch to a current bank account if your credit score rises.

Disadvantages of no credit check bank account

Basic bank accounts provide essential transactional services. However, they lack the full range of features found in standard current accounts.

One major disadvantage of basic bank accounts is the lack of an overdraft. It implies that borrowing money is unavailable, unlike using a standard bank account.

Moreover, you may not receive such features as a chequebook, an arranged overdraft facility, standing orders, and interest on money balances.

Moreover, most basic bank accounts have a daily money withdrawal limit, typically ranging from £200 to £500. If you need to withdraw a higher amount, advance notice may be required.

It’s also possible that you’ll incur costs if you use your debit card overseas or deposit money or checks drawn in a foreign currency.

Moreover, basic bank accounts generally do not provide as many perks and rewards and typically do not offer interest on your money.

Who can get a basic bank account?

Basic bank accounts are for individuals who are ineligible for a standard bank account, and they serve as a valuable option for various situations:

  • Opening an account is a practical choice for people facing financial challenges who cannot qualify for a standard bank account.
  • If you find it difficult to apply online or prefer face-to-face interactions, you can visit a local branch and inquire about their basic bank account offerings directly from the staff.

Appropriateness for a basic bank account is based on specific eligibility criteria:

  • If you have a poor credit history, county court judgments, or have experienced bankruptcy.
  • Having no credit history can also pose challenges, as providers lack a record of your borrowing and spending behaviour.
  • Individuals who have recently moved to the country may encounter different credit circumstances in the UK compared to their previous location.

It’s essential to be aware that being convicted of fraud or failing ID checks may disqualify you from being eligible for an account.

Basic bank account refusal cases

Specific factors may lead to your application refusal. Here are some key points to consider:

Identity checks

When applying for a bank account, you may not open a bank account if you fail an identity or immigration check. It is advisable to ask the bank about the acceptable forms of identification they can accept. This way you can ensure a smoother identification verification process.

Additionally, registering to vote or updating your address on the electoral register could help you pass an identity check.

Some commonwealth people, along with British, Irish, and EU citizens living in the UK, can register to vote. This could help with identity verification.

Immigration checks

Banks may be prohibited from opening accounts for certain individuals due to immigration law restrictions. Most banks can cross-check with a Home Office list to determine if you’re affected.

Seek the counsel of an immigration attorney if you find yourself in a situation where you do not have leave to be in the UK.

If you need more guidance, consulting with an expert in immigration matters can help.

Standard current account

It’s important to note that basic bank accounts are for individuals who can’t obtain a standard account.

Therefore, if you are eligible to open a standard current account or another type of current account, a bank may decline your application for a new basic bank account.

Credit check refusal

A bank may reject your application for a new basic bank account if you decline to undergo a credit check.

Even if you have a poor or no credit score, you may be able to obtain a basic bank account because it is created for these situations. Therefore, there is no need for credit check refusal.

Unfair treatment or discrimination

The bank is obligated to provide a clear explanation if they request additional documents or information from you during the account opening process.

Moreover, banks must treat all customers fairly and adhere to the Financial Conduct Authority (FCA) guidance.

It means providing equal opportunities and support to individuals facing challenges due to various circumstances, ensuring they are not disadvantaged during the account application process.

FAQ

What is the difference between a basic bank account and a standard current account? 

Unlike standard current accounts, a basic account does not offer the option to have a chequebook or access to an overdraft facility.

Basic accounts are designed to provide essential banking services to individuals who may have difficulties qualifying for regular accounts due to financial challenges or credit history.

How old do you need to be to get a basic bank account?

Usually, you must be at least 11 years old to open an account at the bank. Some accounts may have a higher minimum age requirement, such as 16.

Which bank doesn’t check credit scores?

There isn’t a specific bank that universally doesn’t check credit scores. Each bank may have its policies and criteria for opening accounts.

It’s best to check with individual banks for specific account options and eligibility requirements.

Which is the easiest bank account to open?

The easiest bank account to open is typically a basic bank account. It usually doesn’t require a credit score check. Therefore, you can open it with minimal documentation.

However, the availability of basic bank accounts and their specific requirements can vary.

How to get a bank account with a poor credit history?

If you have a poor credit score and need to open or switch your current account, the main choice is a basic bank account with a minimal or no monthly fee.

Another option is fintech accounts. Some digital-only fintechs like swissmoney do not conduct hard credit checks and focus on a soft credit check for identity verification.

Does swissmoney offer a no-credit-check bank account?

Yes, you can open an account on the swissmoney platform without the credit score check.

Živilė Šarkauskaitė

Živilė is a writer with a diverse background, having worked with tech start-ups and pioneering brands across various industries. Her profound interest in progress and innovation drives her to the field of Fintech, a realm that sparks her curiosity and inspires her to share insights with others.

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