Best Student Bank Accounts – 2024 Review

Written by Sam Hodgson
Last updated: 15th August 2024

Student Banking – How to Find the Best Student Bank Accounts in 2024

What does the best student bank account of 2024 look like? Each student has unique needs during their studies, so it can be difficult to determine which student bank account is right for you.

Going to university can be an important time of change and an opportunity to set yourself up for the future. During this time, you may find yourself bombarded with financial products and technical phrases that can be difficult to navigate.

But did you know…

That three in five Britons will have the same bank account for over ten years, and two in five Britons will stick with the same account chosen for them as children? Statistically speaking, you might be sticking with your bank for a while, so it makes sense to do that with intention.

We’re here to make choosing your student bank account a lot easier.

Latest Student Banking Offers 2023
Santander	0% Overdraft: Up to £1500 (or £2000 if you study for longer than 3 years) Incentives: Get a FREE 4 year Railcard Get cashback, vouchers & other offers	Apply » Read more »
App rating: 4.8 (1M Ratings)
HSBC	0% Overdraft: Up to £3000 by third year Incentives: £100 cashback and a 1-year subscription to Headspace	Apply » Read more »
App rating: 4.5 (24.2k ratings)
Lloyds	0% Overdraft: Up to £1500 (or £2000 if you study for longer than 3 years) Incentives: £100 Cashback & up to 15% with Lloyds from selected retailers including Co-op and Sky	Apply » Read more »
App rating: 4.8 (1.7M ratings)
Halifax	0% Overdraft: Up to £1,500 Incentives: £100 cash, 0.10% in-credit bank interest & up to 15% cashback using mobile banking at selected outlets	Apply » Read more »
App rating: 4.8 (1.4M ratings)
TSB	0% Overdraft: Up to £1500 (£2000 available after you graduate) Incentives: 5% in-credit bank interest up to £500	Apply » Read more »
App rating: 4.8 (411.7k ratings)
Barclays	0% Overdraft: Up to £3,000 Incentives: 1-year subscription to Perlego online library	Apply » Read more »
App rating: 4.8 (1.6M ratings)

Is it worth getting a student bank account?

Student bank accounts have unique benefits that can be useful to take advantage of while you’re studying.

‘Freebies’ like cash incentives or a free railcard can come in handy, but it can help to weigh these perks up against what will benefit you most throughout your studies.

Either way, if you choose to open a student bank account, you’re likely to have more benefits suited to your lifestyle as a student, as opposed to sticking with a standard current account.

Student accounts usually feature two significant differences from current standard charges, tailored to the student lifestyle:

Overdraft – Student accounts usually have a large overdraft, with 0% interest. This is a valuable security net for students. You may have to juggle your finances while studying and sometimes dip into borrowing from your overdraft.

Overdrafts can be up to £3,000, depending on the bank you open your account with. And that “up to” is essential – some banks will only offer the total amount to students in their final year or those with excellent credit ratings. So, double-check the fine print before you commit.

You also need to factor in when you need to repay your overdraft by when you’re no longer a student – it won’t last forever!

Incentives / “Freebies” – Many high street banks offer rewards and incentives with their student accounts that appeal to the student lifestyle. Examples range from; a free railcard, cash up front, or cashback and discounts at major retailers and restaurants.

Do I need a student bank account?

You’ll need a bank account to have your student maintenance loan deposited, but this doesn’t necessarily have to be a student account.

However, the benefits of student accounts make them a natural fit if you’re headed to university.

Along with the perks and rewards, you’re unlikely to get an interest-free overdraft with a standard current account.

And as you won’t be missing out on any standard banking features by choosing a student account, most students tend to go with this option.

Which banks offer student accounts?

Most popular UK high street banks offer student accounts, including Santander, Lloyds Bank, Barclays, HSBC, Nationwide, NatWest and RBS. But each bank offers different incentives and overdraft limits.

Consider which incentives are offered to appeal to you and whether the overdraft limits will suit your needs. Most banks offer similar products – the main difference being the incentives and overdraft facilities you have access to.

Why do banks offer student accounts?

While you may currently be relying on loans to fund your education, you are investing in your future career.

And the chances are that the career you go into will allow you a higher-than-average salary in the coming years.

Given the statistics we’ve seen of how many people in the UK stick with the same bank for life, by offering interest-free overdrafts and cash incentives, they have a good chance of securing you as a loyal long-term customer.

However, while this justifies why many banks would invest in offering incentives for student bank accounts, this doesn’t mean you can’t switch in the future.

And there are many reasons you may want to switch as your circumstances evolve.

Is a student overdraft a good idea?

Having access to a student bank account can certainly come in handy. With your studies taking up most of your time and long periods between maintenance loans, you may need an additional injection of funds.

What makes student bank accounts unique is that most offer interest-free overdrafts. This means you could access interest-free borrowing the whole time you study – which can be comforting to know even if you don’t use it.

Unlike a credit card or a personal loan, you won’t have to pay this money back while you’re a student, and as long as you’re careful with it, and you repay your overdraft in a timely manner, it usually won’t have an impact on your credit score.

What features to look for in a student bank account

A few key features should be considered when comparing student bank accounts:

Interest rates

Some student bank accounts allow you to earn interest on the money you deposit, which is handy.

Overdraft facilities

An overdraft allows you to borrow money from your bank when your account balance is negative. This can be a helpful safety net if you ever need to cover an unexpected expense.

Fees

Look for an account with low or no fees, as fees can add up quickly and eat into your budget.

Perks and discounts

Many student bank accounts have perks and discounts, such as free railcards or discounted gym memberships. Consider which perks are most valuable to you when choosing an account.

App Usability

Modern technology is changing the way we use banks. With many banks encouraging their customers to use online banking instead of in-person branches, a smooth in-app experience is becoming more important.

Customer satisfaction

Not sure which bank to go with? Reviews and ratings from customers are a great way to get an idea of how well customers feel their bank is treating them and get a gauge of the customer service each bank can offer.

Santander

Santander offers up to a £1500 overdraft, which starts at £250 and has the capacity to increase to the full amount during the first year. However, access to the full amount isn’t guaranteed and will depend on your credit rating.

They also offer a four-year Railcard that will save 1/3 off your train journeys – pretty handy if you need to travel back home a lot!

To be qualify for the overdraft, you’ll need to deposit at least £500 into your account per term (and it’s okay if this is your maintenance loan.)

Pros

• £100 Cash
• Railcard
• £1500 overdraft
• Overdraft limit increases to £2000 if you study for over 3 years

Cons

• Full overdraft not guaranteed

Apply »

Nationwide Flexstudent

Nationwide has similar offerings to HSBC, with up to a £100 cash incentive and a £3000 overdraft. Your overdraft will start at £1000, and you can apply to increase by £1000 each year.

You must deposit at least £500 a term to be eligible for the overdraft. Your interest-free overdraft will gradually be decreased for three years after you graduate.

If you studied for less than three years, your interest-free overdraft will only be available for two years after you finish studying.

For this account, you can only apply five months or less before your course begins or within two months of your course beginning.

Pros

• Largest overdraft (£3000)
• £100 cash
• Guaranteed overdraft
• Overdraft limit goes up by £1000 a year
• Interest-free overdraft for three years after you graduate (or 2 years if you studied for less than three years)

Cons

• Need to deposit £500 a term to be eligible
• Stringent application deadline

Apply »

HSBC

HSBC has a generous overdraft limit of up to £3000. The overdraft limit starts at £1000 in the first year, and then you can ask for an increase of £1000 each year. Whether you are eligible for the full overdraft amount will depend on your spending habits and how the account is used.

Their £3000 interest-free overdraft limit is available for the first year after you graduate and then reduces by £1000 each year.   While the overdraft limit you’ll have access to may vary, you’ll likely have access to an interest-free overdraft for three years after you graduate.

HSBC are offering £100 cash and a 1-year subscription to the meditation app Headspace to those who open a student account with them this year.  You must be 18+, have been a UK resident for over 3 years and on a qualifying course in the UK to be eligible for this account.

Pros

• Largest overdraft (£3000)
• Overdraft limit goes up by £1000 a year

• Interest-free overdraft available for three years after you graduate
• £100 cash
• 1-year subscription to Headspace

Cons

• To be eligible for cash, students need to make 5 debit card transactions within first 30 days of opening account
• Stringent criteria for account and cash incentive

• Full overdraft not guaranteed

Apply »

Lloyds

Lloyds’ overdraft limit is offered in stages, starting at £500 initially, then £1000 after six months. Most students are eligible for the full £1500 after nine months. The overdraft limit will extend to £2000 if you study for over three years.

Lloyds offers £100 cash and 15% cashback with selected brands, including Costa, Co-op and the Hilton.

Your interest-free overdraft will be available for three years after you graduate, but the overdraft limit will be reduced by £500 each year.

Pros

• £1500 overdraft limit (for first 3 years)
• Most students are eligible for full amount after first year
• Interest-free overdraft available for three years after you graduate
• 15% cash back with selected stores

Cons

• Overdraft limit is only £500 for first 6 months

Apply »

Halifax

Halifax does advertise an overdraft limit of up to £1500, but whether you’ll have access to the full amount will depend on your credit history and spending habits.

If you aren’t offered the full overdraft amount, this does make Halifax’s overdraft offering slightly lower than other banks. But this is only an issue if you expect to need a larger student overdraft in the future.

On the plus side, Halifax offers £100 cash for getting a student account with them and 15% cashback across various brands, including Costa, Sainsbury’s and Booking.com.

Pros

• £100 cash
• 15% cashback with selected stores
• No specific eligibility requirements

Cons

• Low overdraft limit

Apply »

TSB

TSB’s student overdraft is structured similarly to Lloyds. Its overdraft limit is £1500, starting at £500, then hiking to £1000 after six months. The full £1500 is available after nine months.

You’ll need to apply for your overdraft limit to be increased, but there is reportedly a high chance you’ll receive the full overdraft by the second year.

Your interest-free overdraft will be available for three years after you finish your studies, and you will also have the option to extend your overdraft to £2000. Whether or not you have access to the full overdraft amount at any point does depend on your credit score.

Your interest-free overdraft will be available for up to three years after you finish studying. You’ll also get 5% interest on balances up to £500, which equates to £25 a year.

Pros

• Reportedly common to receive full overdraft by second year
• 5% interest on balances up to £500 (£25 a year)
• £2000 interest-free overdraft available for 3 years after you finish studying
• No specific eligibility for account

Cons

• Overdraft limit is only £500 for first 6 months
• Need to apply and request for overdraft to be increased
• Full overdraft amount depends on your credit score

Apply »

Barclays

Barclays offers a reasonable £1500 overdraft that starts at £500. An £1000 overdraft limit will be available in your first year, and then you can ask to increase to £1500 in your second year.

The overdraft limit you can access will depend on your credit score.

You can apply for a graduate account on you finish your studies, where you’ll have access to an interest-free overdraft and exclusive rewards for up to three years.

Pros

• Up to £1500 overdraft
• Tailored graduate account
• Interest-free overdraft & perks for three years after you graduate

Cons

• Have to ask to increase to the full amount
• The full overdraft amount depends on the credit score
• Need to apply for a graduate account

Apply »

What do I need to open a student account?

Opening a student account is similar to opening a standard current account with a bank. You’ll need to be over 18 and provide a valid ID (Driving License, passport etc.) and any documents that display your proof of address, such as a bank statement or utility bill.

The only additional requirement for a student is to show proof of their student status. If you’ve recently been accepted into a university, you can use a letter of acceptance as proof or your UCAS offer letter.

Alternatively, a quicker option is through your UCAS status code. If your university placement is confirmed, you can use your UCAS status to prove your student status to any bank.

If you’re already a bank customer, you can use your UCAS code as proof to upgrade your current account into a student account – retaining any Direct Debits and standing orders you may have.

How do I open a student bank account?

The application process is relatively simple: you can apply online through your chosen bank’s website or visit a local branch.

• One or two forms of photo ID: such as a passport or driving licence
• Proof of address: such as a recent utility bill or bank statement
• Proof of student status: a letter of acceptance from your university or UCAS offer letter.

You’ll need to have all the above documents and your proof of student status, and some banks may require additional information too.

Whether you make an online application or go to a local branch, approval of your student account may take some time.

There may also be the possibility of a credit check against you, and you could be rejected if you have outstanding debts or an outstanding overdraft. While this is unlikely and not a concern for most students, it can affect the overdraft limits offered.

When should I set up a student bank account?

It’s best to consider your options before being accepted to get a general idea of which student account offerings appeal most to you.

If you’re already a customer at a bank, you may wish to consider staying with them for a student account for simplicity; however, there may be better offers elsewhere if you shop around.

Regardless of your choice, you’ll want to ensure your student account is set up for the beginning of your term when you start your course. Depending on whom you bank with, you can usually set up and use your student account when you have confirmation of your placement.

How to find the best student bank account

It’s advisable to consider your options when choosing a student bank account.

Remember, while incentives are an excellent addition and cash upfront may be enticing, you should first consider the overdraft. You may prefer an interest-free overdraft that suits your needs over a short-term “freebie”.

However, remember that overdrafts are a form of borrowing – you must pay it back at some point. So, be mindful of the consequences of overspending and dipping into your overdraft too often.

It’s important to pay attention to the repayment conditions and when you’ll need to repay your overdraft.

And don’t forget to look at each account’s reviews and customer satisfaction ratings. Whether it’s a clunky mobile banking app or a poor customer service experience, you don’t want it getting in the way of your student experience.

How to Compare Student Bank Accounts

To compare student bank accounts, follow these steps:

• Make a list of your banking needs – Consider how you’ll be using your bank account, including how often you’ll be making deposits and withdrawals, whether you’ll be using online banking, and whether you’ll need to make international payments
• Research different accounts – Look for accounts that offer the features you need, such as a high interest rate or a low overdraft fee
• Compare the costs – Calculate the total cost of each account, including any fees, to determine which account is the most cost-effective
• Check the fine print – Be sure to read the terms and conditions of each account carefully, as some may have hidden fees or restrictions that you need to be made aware of

FAQs

What is the best student bank in the UK?

The best student bank for you really depends on what you will be prioritising throughout your studies.

Each student has different needs and therefore, different perks will be of more value, so this can really only be judged on a case-by-case basis.

That being said, HSBC has the largest overdraft limit, offering a pretty high chance of securing a £3000 overdraft by your third year. Co-op offers the largest overdraft limit upfront at £1400 in your first year. Natwest and RBS offer the most incentives.

Can I have 2 student accounts?

Generally, student bank accounts will have a clause that means you can only have one student bank account at a time.

While you can have multiple current and savings accounts, the main feature of student accounts is interest-free borrowing in the form of a student overdraft.

It usually wouldn’t make sense to be able to open more than one student overdraft, as this could allow you to borrow more than you can manage.

Is Monzo good for students?

Monzo is great for helping you save money, and because it is an online bank, the app is smooth and easy to use (with a 4.9 rating on the app store).

However, Monzo doesn’t offer a student bank account, so you won’t have access to a student overdraft with Monzo. This means if you do go into your overdraft, you’ll have to pay interest.

It does offer some nifty features that help you track your spending and plan your budgets, though, which can be useful for students.

Is Starling good for students?

Starling Bank is another flagship online bank that has become popular. Online banks tend to rely on apps, so their usability is typically quite streamlined.

However, Starling doesn’t offer a tailored student account, meaning that you won’t have access to a student overdraft.

But Starling also has many in-app features that offer insights into your spending habits and savings spaces that you can use to set budgets, and this easy-to-use interface can be great for young people.

Do student bank accounts affect credit score?

The key feature of your student bank account to be aware of is your student overdraft. While student accounts offer you limited interest-free borrowing, this will appear on your credit report.

You usually won’t have to pay interest on your student overdraft (at least not until after you graduate).

However, if you stay in your student overdraft for long periods of time, this can signal that you are struggling to manage your money and affect your credit score.