• You can have benefits paid straight into your bank account
• You can pay bills, for example, your rent, by direct debit
• Having a bank account helps to give you a good credit record and you may be able to benefit from other banking services
• Cashing cheques can be difficult and cost you money if you don't have a bank account to pay your cheque into
What is a basic bank account?
The government says that banks have to make basic bank accounts available to everyone, even people with a poor credit record.
For more information you can download a leaflet about basic accounts.
How do I open a basic bank account?
You will need to:
• Visit the bank you would like to use and ask to open a basic bank account
• Show them at least two proofs of your identity and where you live, for example, a passport, driving licence or utility bill.
What can I use my basic bank account for?
You will be able to:
• Pay money into your account
• Pay cheques into your account
• Have benefits paid directly into your account
• Set up regular direct debits to pay bills
Also – most basic bank accounts will offer a cash card so you can take out money free of charge at a cash machine or post office.
Will I have a chequebook and debit card?
Probably not - Most basic bank accounts do not offer a chequebook or credit card.
Can I be overdrawn?
Most basic bank accounts will not allow you to have an overdraft. If you do not have enough money in your account to cover any payments going out (direct debits) you will probably be charged.
How will I know how much is in my account?
You will receive regular statements from the bank and you will probably be able to check your balance at a post office or cash machine at any time.
Is there an alternative to a basic bank account?
You may prefer to open an account with a credit union. Visit our page about South Yorkshire Credit Union to find out more.
Are you paying too much for essential goods and services?
A study has found that poor families have to pay on average £1,280 more every year for essential goods and services such as gas, electricity and insurance. This extra amount is known as the 'poverty premium'. Basic goods, such as a fridge or oven can cost 150% more if bought on credit, and fuel can cost 10% more on a prepayment meter.
The study was carried out by the charity Save the Children and the Family Welfare Association.
If you would like to find out more, visit the Save the Children website.
You can also download the charity's report.