Student accounts are specifically designed for those in higher education. They allow you to pay money in and out of the account, as well as offering additional benefits such as an interest free overdraft. In most cases you will also be provided with a debit card, with which you can pay for items and services in stores as well as online, without the need to withdraw cash.
The overdraft facitlity, included with most student accounts, allows you to spend more money than you actually have in your account up to a certain limit.
Student accounts provide a set level of overdraft interest free for the length of your course.
If you exceed your overdraft limit you will incur some fees, but as long as you stay within the boundaries most student accounts have no fees, whether you are overdrawn or in credit. However, if you do exceed your limits, the fees can be massive - transactions could cost up to £30 with interest on top.
When looking at the costs of banking, it is good to search in terms of interest. Interest is the cost of borrowing money, but it can also be the reward for saving it. For example, if you are given 5 per cent interest for saving you earn £5 per £100 per year on the cash you have in your account.
Using our student bank account comparison section, you can choose an account that best suits your wants and needs and apply online. Many providers also supply students with a wide range of discount vouchers and loads of other special offers to attract you from the competition, so make sure you check out the competition before you decide.