How to open a bank account in the United Kingdom

A bank account will eventually be necessary if you're considering relocating to the UK or have already arrived.

Previously, newcomers to the country faced significant challenges when opening a bank account in the UK. However, fortunately, the process has become more manageable in recent times.

Opening a bank account in the UK typically involves several steps. Here's a general guide to help you through the process:

Step 1:

Choose a Bank: Research different banks in the UK to find one that suits your needs. Look into fees, account features, online banking options, and branch availability. This article will briefly overview the four central banks in the UK, plus two others.

The Big Four UK banks

There are more than ten retail banks in the UK, each with strengths and weaknesses. However, the four most significant UK banks are Barclays, Lloyds, HSBC and NatWest.

Let’s have a look at what each of them has to offer.

Barclays

Barclays is a multinational bank offering a wide range of financial services. Some of their key offerings include personal and business banking, mortgages, loans, credit cards, investments, wealth management, and corporate banking.

It’s also probably one of the most accessible banks to open an account with if you’re new to the UK. You can even pre-apply for an account online before you arrive in the UK.

The account is free and comes with a contactless Visa debit card as standard. However, you won’t be able to use your account immediately. Once in the UK, you must visit a branch with your reference number, passport and proof of address to activate the account.

Barclays also has special accounts for students and businesses.

The international student account is free and offers cashback from various shops. It includes a free overdraft of up to £3,000 for three years and a contactless debit card. You also get a 12-month subscription to Perlego, which gives you access to more than 400,000 academic and non-fiction eBooks.

The account includes a free overdraft of up to £3,000 for three years and a contactless debit card.

They also provide online and mobile banking facilities for easy access to their services.

Lloyds

Lloyds Banking Group is a leading provider of current accounts in the UK, boasting the largest market share. With a network of approximately 1,100 branches nationwide, Lloyds offers widespread access to its services.

Opening a bank account with Lloyds is a hassle-free process, even if you are a newcomer to the UK. They have introduced a unique new UK account, which typically allows you to open an account using your passport or identity card (for EU citizens). This account is free of charge and includes a contactless Visa debit card as a standard feature.

For students, Lloyds offers a specialised account that comes with attractive benefits. Students can enjoy a free overdraft of up to £1,500 for three years, providing valuable financial flexibility during their academic journey.

Lloyds recognises the needs of businesses and offers dedicated business accounts. Depending on the size of your business, you have the option to choose from three different account types.

HSBC

HSBC operates a vast network of over 1,100 branches throughout England and Wales, although its presence is comparatively more minor in Scotland and Northern Ireland.

One of HSBC's standout advantages is its extensive global presence, with operations in approximately 64 countries. This global reach enables HSBC customers from their home countries to quickly set up accounts in the UK before their arrival.

For essential day-to-day banking, HSBC offers a basic current account. This account has no monthly fees, provides a contactless Visa debit card, and allows withdrawals of up to £300 per day. However, it's important to note that the primary account does not offer arranged overdrafts.

HSBC's student account is tailored to meet students' needs. Students can benefit from a free overdraft of £1,000 in the first year. They can request an increase to £2,000 in the second year. HSBC also provides helpful guides to assist students in managing their finances.

For Business accounts, HSBC offers a range of options. Most of these accounts are free for the initial 18 months and provide various perks such as; a dedicated relationship manager to help you develop your business and access a knowledge centre containing training articles and videos.

NatWest Group

NatWest's Select current account is free and includes a contactless Visa debit card as a standard feature. In addition, customers have access to an emergency cash service, allowing them to withdraw money from their account using a security code in case of a lost or stolen card.

NatWest offers excellent options for both students and businesses. For example, you can benefit from a free overdraft of up to £2,000 for three years as a student. Moreover, NatWest presents three appealing choices: an Amazon Prime Student membership, a National Express Coachcard, or a tastecard.

For aspiring business owners, NatWest provides the Startup account, which offers complimentary financial services for 18 months. This package also grants access to their learning platform and business growth events.

Should you require assistance, NatWest offers customer support through live chat. This feature enables real-time discussions to address application details and any inquiries you may have.

In addition to the four central banks in the UK (Barclays, Lloyds, HSBC, and NatWest), there are other noteworthy banks worth considering:

TSB

TSB has gained recognition as one of the top banks in the UK. Opening an account with TSB is relatively straightforward, even for newcomers to the UK. Their Classic Plus account offers appealing perks, including 1.49% gross variable interest on balances up to £1,500 and £5 cashback for debit card transactions (terms and conditions apply).

For students, TSB provides an account with overdraft protection of up to £1,500 and 4.89% gross variable interest on the first £500.

Santander

Santander is famous for its 1|2|3| account, which offers up to 3% cashback on household bills and 0.60% gross variable interest on balances up to £20,000. It's important to note that this account requires a credit check during the application process, which may pose challenges for newcomers to the UK. However, considering it after residing in the UK for some time (around a year or so) can be a good idea.

It's always advisable to explore the offerings of different banks and compare their deals. Then, only commit to a product after exploring other options available in the market.

Step 2:

Gather Required Documents: To open a bank account in the UK, you'll typically need the following documents:

What documentation is required to open a bank account in the UK?

To open a bank account in the UK, you will need two essential documents: one to verify your identity and another to confirm your address. This requirement applies to both in-branch and online account openings.

Proving your identity is a straightforward process. You can provide your passport, driving licence, or identity card (if you are an EU national).

Additionally, you must demonstrate your address by submitting another supporting document. Each bank has its specific list of acceptable documents as proof of address. Generally, the following documents are commonly accepted:

For proof of address, acceptable documents include utility bills, bank statements, or government letters that display your name and current address.

You may also need proof of income or employment, such as pay stubs, employment contracts, or tax documents.

Non-UK residents might need additional documentation to prove UK residency, such as a visa or residence permit.

How to open a bank account in the UK without proof of address?

Of course, if you’re new to the UK, you probably don’t have any documents on this list.

Luckily, in recent years, banks have become more flexible regarding what documents they will accept as proof of address.

If you’re in the UK to study, many banks will accept a letter from your University’s admissions office confirming your address.

Many banks will also accept a letter from Jobcentre Plus confirming your National Insurance number or even a letter from your employer, as long as it’s less than three months old.

There is also another way.

Before you leave for the UK, ask your bank to change your correspondence address to your UK address. You can also do this via internet banking.

Once you’ve changed your address, ask your bank to send a bank statement to your new address by post, and you’ll have a document that proves your UK address.

If you need proof of address in the UK and need to open an account, Wise's multi-currency account may be the right choice. You can supply evidence of address from your standard list of documents and do verification online.

Step 3:

Explore your options: In addition to noting the documents required and your preferred bank, you should familiarise yourself with the process, costs specific offers to make the best choice.

Can I open a bank account before arriving in the UK?

Indeed, opening a bank account before arriving in the UK is possible.

If your current bank has a correspondent banking relationship with a British bank, they can assist you in setting up an account.

Many central UK banks offer "international" accounts designed explicitly for non-residents. These accounts can be suitable if you need more documents to prove your UK address. Some banks even provide the convenience of applying for an international account online.

However, there may be more favourable alternatives to opening a bank account abroad or internationally.

These international accounts often require a significant initial deposit and a commitment to maintain a minimum balance or make regular monthly payments. In addition, some banks may charge a monthly fee in addition to these requirements. Consequently, opening and maintaining such an account can be expensive, especially if you have yet to secure employment.

Which bank is best for my needs?

Determining the best bank for your needs can be subjective, depending on various factors.

The UK banking sector is highly competitive, with different banks offering specialised products tailored to specific customer segments.

This is advantageous for you, as suitable options are likely available whether you're a student, a professional, or a business owner.

However, it's essential to consider your circumstances, personal preferences, and the specific requirements you have for a current account.

What are the costs associated with banking in the UK?

Most high street banks in the UK offer basic current accounts without any monthly fees, which sufficiently meet your everyday banking needs.

Additionally, many banks provide premium accounts offered by banks provide, additional benefits like cashback on household bills, in-credit interest, and insurance. However, these accounts often involve monthly fees and eligibility requirements that may make you ineligible if you're new to the UK.

It's essential to exercise caution and maintain a positive balance. Without an arranged overdraft, withdrawing more money than you have in your account can result in significant fees from your bank. Reviewing your bank's terms and conditions is recommended to avoid unpleasant surprises.

ATM fees:

Withdrawing money from your bank's ATMs is typically free. Some banks also allow free cash withdrawals even if you're not their customer.

However, certain non-affiliated ATMs may charge fees ranging from £1.50 to £3 per transaction. Check the ATM before use, as many ATMs indicate if they are free or if fees apply.

Using an ATM outside the UK incurs fees. Banks often impose a non-sterling transaction fee of as high as 2.99% per transaction. Cash withdrawal and non-sterling transaction fees may also apply.

When prompted to choose a currency at a foreign ATM, always select the local currency to avoid unfavourable exchange rates and fees charged by your UK bank.

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