Banking: traditional vs challenger bank
Did you know that you don’t have to bank with a traditional high street bank? Here we explain the difference between a high street and a challenger bank.
All of the UK’s nine main banks and building societies offer specialist student accounts; HSBC, Barclays, RBS, Santander, Bank of Ireland, Allied Irish Bank, Danske, Lloyds and Nationwide. You need to be 18 years or over to open a student account. You will need to have applied for university and/or student finance and it’s likely you will need to provide evidence of this when opening the account.
Student accounts offer interest free overdrafts and other incentives to get your business.
Watch this video from the Money Advice Service for information on how to open a bank account:
As well as traditional banks, the market is now seeing more and more challenger banks opening. Their aim is to ‘challenge’ the traditional banks.
They are digital only banks, so do not have any branches. You bank with them via apps and their website.
Challenger banks do not offer student specialist accounts, but they do offer a full range of services including overdrafts in their standard accounts.
Most UK challenger banks have an 18-year age restriction, but some do allow you to open an account from 16, however you won’t be able to access their overdraft facilities.
Challenger banks offer:
- Accessible Apps that work with inbuilt device accessibility software
- Instant notifications, that are sent to your phones within seconds of making a payment
- Useful budgeting tool apps can show detailed monthly spending reports
- Free currency with no fees abroad
Whether you choose a traditional or challenger bank, it’s important to compare banks and accounts to find out what is best for you and your circumstance.
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