January 2016 brings good news for many as this month has seen the launch of a brand new type of bank account – a basic bank account with NO fees. Many banks and building societies are now offering basic accounts with no charges after an agreement was made between government and the banks.
Fee-free basic bank accounts have been introduced for anyone who does not have a bank account, isn’t eligible for other current accounts or can’t use their existing account because of financial difficulties.
Banks have often charged customers for failed payments, which can lead to further debt problems. Basic bank accounts offer a helpful alternative as they will be free of charges, even if Direct Debits or Standing Orders fail. With more than one million people without a bank account, the basic bank account offers an easier way of managing your money.
What you need to know about basic bank accounts…
- There are no charges for failed payments – you will not be charged for missing a direct debit payment or a standing order.
- There is no overdraft on these accounts – basic fee-free bank accounts don’t offer an overdraft facility, preventing account holders spending more than is available.
- It doesn’t matter if you don’t have a good credit history – as you can’t go overdrawn, you don’t need to pass a credit check when opening an account.
Who is offering basic bank accounts?
Banks and building societies that are currently offering basic non-fee bank accounts are listed below:
- Bank of Scotland brands
- The Royal Bank of Scotland
- Co-operative Bank
- Yorkshire Bank
- Clydesdale brands
Making the basic bank account work for you…
It is important to remember that whilst banks won’t charge for failed payments on basic accounts, the company that the direct debit or standing order was for might. Therefore it is important to manage your account as much as you can. Here are a few tips that can help….
- Always look for free to use cash machines – this will help to reduce unnecessary costs.
- Keep an eye on your bank account – make sure you are constantly checking your account to ensure you are able to pay Direct Debits and Standing Orders.
- For more tips on managing your money check out our guide to surviving the January Pinch
At Buy As You View, we know that keeping on top of your finances is very important. We don’t charge late fees – we think this would make a difficult situation even worse. If you miss payments we’ll work with you to get you back on track. Our SmartMeter helps us work with our customers to keep payments manageable.