If you're off to university, here are the top bank accounts designed for students in terms of highest in-credit rates, cheapest overdrafts and best perks.
Getting a decent student bank account should be a top priority, no matter what stage of study you’re at.
Here we explain what you should look out for when comparing bank accounts and round up some of the best deals on offer right now.
What to look for in a student bank account
As many students will spend at least part of their time at university ‘in the red’, a vital thing to look for in a student bank account is a decent interest-free overdraft.
The best accounts currently offer fee-free and interest-free overdrafts of up to £3,250.
But this upper limit usually only applies to those in their third year (or year four and above if your degree is longer), so it starts off lower and rises with each academic year.
Also, you may not get the maximum overdraft advertised, as your individual limit will be based on your credit score.
Some banks do guarantee to give you this upper limit, so always check whether the overdraft limit on offer with the student bank account is ‘guaranteed’ or only ‘up to.’
Don't be tempted to exceed your overdraft limit without permission. And to state the obvious, it's a limit, not a target, as you must pay back all this borrowed money one day.
After 0% overdrafts, the next feature to consider is credit interest rates (how much you'll be paid when your balance is above zero), as well as freebies, gifts and other incentives.
Convenience also plays a part. Many students may sign up to banks that have branches or cash points on campus, but with internet and mobile banking now so prevalent, this is arguably less important.
Top student bank account picks
At the time of writing, NatWest/RBS offers the highest 0% overdraft limits at £3,250 (with several other banks not far behind on £3,000).
If you're looking for interest, TSB pays an impressive 5% AER on balances up to £500.
In terms of welcome bonuses, Santander is currently offering students the chance to win up to three years' worth of tuition fees (as well as a free four-year Railcard).
The table below reveals what's on offer to students today. We've included any credit interest rate, free overdraft limit and incentives, but please bear in mind that these may not be the most important factors for you.
Consider your personal needs – specifically your spending and savings habits – before applying.
It’s vital to make sure you’re not swayed by incentives alone, as these accounts may include less attractive overdrafts.
Here’s a roundup of what the major banks offer (ordered alphabetically).
|
Account |
Credit interest |
0% overdraft |
Overdraft interest rate (over fee-free limit) |
Incentives |
|
Bank of Scotland Student Account |
None |
Tiered – up to £1,500 in years 1-3 (lower limit in first 10 months) Years 4-6 - up to £2,000 |
N/A |
£110 bonus if you pay in £500 before the end of October* Up to 15% cashback via scheme Everyday Offers. |
|
Barclays Student Additions Account |
None |
First term – up to £500, then up to £1,000 Year 2 and beyond – up to £1,500 |
N/A |
|
|
Halifax Student Current Account |
0.5% AER |
Up to £1,500 |
N/A |
£110 bonus if you pay in £500 before the end of October* Earn up to 15% cashback (you need to register for online banking and activate Cashback Extras). Access to Save the Change |
|
HSBC Student Bank Account |
None |
Year 1 – at least £1,000 (guaranteed) Year 2 – up to £2,000 Year 3 – up to £3,000 |
N/A |
£125 welcome bonus for existing customers** Access to Regular Saver paying 7% AER on deposits between £25 and £250 per month |
|
Lloyds Bank Student Current Account |
2% AER on balances between £1 and £5,000 |
Tiered – up to £1,500 in years 1-3 (lower limit in first 10 months) Years 4-6 - up to £2,000 |
39.90% (over fee-free overdraft limit) |
£110 bonus if you pay in £500 before the end of October* |
|
Nationwide FlexStudent Account |
None |
Year 1 – £1,000 Year 2 – £2,000 Year 3 – £3,000 |
N/A |
£100 cash, £120 JustEat vouchers*** |
|
NatWest/Royal Bank of Scotland Student Account |
None |
Up to £2,000 after first term (£500 in the first term) Up to £3,250 from year 3 onwards |
N/A |
£100 cash, plus a free Tastecard for four years |
|
Santander Edge Student Current Account |
None |
Years 1-3 - £1,500 Year 4 - £1,800 Year 5 - £2,000 |
N/A |
Free 16-25 railcard offering a third off UK rail travel (you must register for online banking) Chance to win up to three years' worth of tuition fees Access to Santander Boosts |
|
TSB Student Bank Account |
5% on balances of up to £500 |
First 6 months - £500 Months 7-9 - up to £1,000 From month 10 - up to £1,500 |
39.90% EAR on overdrafts of over £1,500 |
*You'll receive the bonus in November
**You must have opened your existing account before 1 July, 2024, open a student account and make five direct card payments by 30 September.
***You need to open an account and pay in £500 before 13 December, 2024.
Bear in mind that these deals could be altered at short notice
Where are the challenger banks?
You may be wondering why Monzo, Starling or Revolut haven't been included in our roundup.
Although these banks have great mobile apps, and advantages for frequent travellers, they don't currently offer interest-free overdrafts or any of the perks mentioned above.
There is, however, nothing stopping you from having two bank accounts and transferring money between them if you want the perks of different accounts.
Feel free to move
Finally, remember that signing up for one bank's student account does not mean that you have to stick with it for life.
You can switch student accounts from one year to the next, as well as move to a top graduate account once you've got your degree.