Best Student Current Account

Best Student Current Account

Student accounts offer some great deals and switch rewards. With so many to choose from, spending some time comparing is necessary to find the right offer for you. As standard, student accounts offer an interest free overdraft, sometimes up to £3000, as well as a range of free incentives, such as a railcard.

Student Account Comparison

1) Santander 123 for students

This account offers some great rewards for students. Once again Santander are offering a four-year Young Person’s Railcard, worth around £100, for free. With train prices becoming more expensive, having a third off the ticket value is a guaranteed way to save money providing you travel by train. Railcard can also be applied to London travel cards.

This account also pays up to 3% interest on balances of £300 to £2000.

For those who need the cash, an interest free overdraft of up to £1,500 in the first three years of your course is available. Fourth and fifth year students get up to £2,000 interest-free. If you’re likely to remain in credit then this high interest bank account is a great choice as with a £2000 balance and the railcard you’ll earn £160 of rewards in the first year, plus any savings you make with your railcard.

Useful to Know

• The overdraft must be arranged as you could be charged £5 for using an unplanned overdraft.
• You need to pay £500 every academic term and register for online banking to receive these perks.

2) The Co-op student account

If you need a larger overdraft then this account offers a good deal as most applicants receive the full amount. Students are entitled to £1,400 interest-free overdraft in the first year of university. This increases to £1,700 in second year and £2,000 in third year.

The Co-op do not pay interest on the balance so this may not suit students who are likely to stay in credit unless they plan on opening a separate savings account.

They also do not offer any switch reward or incentives.

Co-op hold an ‘ethical policy’ meaning they won't work with organisations that they feel fail to uphold basic human rights or significantly harm the environment.

3) Nationwide FlexStudent

This year, Nationwide launched FlexStudent, its first student account.
While they don’t offer any switch rewards, they do offer a sizable overdraft of £1,000 in the first year, £2,000 in year two and £3,000 in the third. They also offer 1% interest on balances up to £1,000 - ideal for people who are likely to stay in credit.

Useful to Know

• They don’t charge fees for unauthorised overdrafts but will freeze the account until you bring the account back up to your limit.

4) HSBC student account

Like Santander, HSBS is offering some tempting money-saving rewards for switching.

They offer a £60 Amazon voucher plus one-year Amazon Prime membership which will save a lot on delivery fees if you’re likely to use Amazon a lot.

It also has the biggest interest-free overdraft at £3,000, available from first year to students aged 18 or older. Not everyone will get the maximum amount but HSBC says it offers all applicants at least £500.

First year students also earn 1.75% (or 1.5% above Base Rate) on the first £1,000 of their student bank account making this a very attractive all-round account.

5) First Direct current account

While First Direct don’t offer a specific student account, the online and telephone bank gives you £100 when you switch. You just need to pay in £1,000 within three months of opening the account. You'll also get a £250 interest-free overdraft. Unlike the other accounts these rates will carry on once you graduate. As an extra incentive, if you want to close your account after six months, you'll get another £100. If you need a bigger overdraft or want to earn interest on your balance, however, this may not be the best account for you. 

6) Barclays Student Additions

Barclays offers free text alerts warning you if your balance is low and a £500 overdraft when you open your account. You may be able to increase the fee-free overdraft to £3,000 while you are studying. Account holders can also earn cashback from retailers such as Topman, Waterstones and Boots so this could be rewarding if you regularly shop in these places.

7) NatWest/RBS

These banks offer a switch reward of a free 4 year National Express coachcard giving users a third off coach fares. The card is normally worth £35 and if you regularly travel by coach you could make some great savings.

Students can apply for a £500 overdraft in the first term and upgrade to £2,000 after that. NatWest/RBS do not pay interest on any credit balance in your account, so this may not suit people who are looking to earn interest.

Useful to Know

• If you do not have enough money in your account and try to make payments, the bank will charge you a fee of £6 per payment up to £60 per month.
• You must use the bank account as your main account and pay in at least £750 every six months and make three debit transaction each month.

8) TSB student account

While this account is not offering a switch reward, they do offer a great rate of interest of 5% on balances up to £500. They also offer a £1500 interest free overdraft.

Useful to Know

• If you go over your overdraft, you will be charged 8.21% interest plus a £6 monthly fee.

10) Lloyds Bank student account

Lloyds offer text alerts to keep you in control of your balance a well as a free overdraft of £500 for your first 6 months which increases to £1,500.
They do not pay interest or offer any kind of reward for joining.

Useful to Know

•  If you go over the limit, you'll pay a monthly fee of £6 and 8.21% interest.

It’s very easy to get lost while searching for a student account as there are so many on offer and all vying for attention from students. However, there are some great deals out there and it’s definitely worth shopping around for the best switch rewards as these can provide long term savings.