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Finding the Right Bank for You

When you first arrive in the UK, there are a number of everyday tasks you need to set up. One of the more important ones is opening a bank account.  The number of options and plans available can be a bit overwhelming.  

Before even looking at your options taking a few minutes to think about how your will use your account (regular pay ins, bills you have due, and how and where you spend your money) will help you start the process of choosing the best account for you.

You should also look at the bank’s customer service options and reports, your interest rate, and the ease of opening an account.

Customer Service

Banks have a rather notorious history of providing a lower than expected customer service. A recent poll showed that the average customer satisfaction score for banks hovered at around 62%.

The quality of customer service is possibly the most important aspect to consider when opening a new account.  Look for banks which have convenient methods for contacting them. You want the statements to be clear and easy to understand. You should also look for telephone service and an easy to use fully functional online portal as well.

In a number of surveys and independent research First Direct consistently ranks high in overall customer satisfaction. The only big downside to First Direct is that they do not operate branches, so if face-to-face banking is your preferred method, you should pick another bank. (You can pay in cheques and make withdrawals at HSBC branches however.)

Several of the other High Street banks, like Norwich and Peterborough, Coventry Building Society, Metro Bank and Citibank receive fairly high customer scores as well.

Accounts that Pay Higher Interest

You want to look for banks that pay a high interest rate for credit accounts. Currently it is possible to find a number of banks that pay 5% AER. However it is important to note that many of these will drop to 3% in January 2017.

First Direct, Santander, Bank of Scotland, TSB, Club Lloyd, and Tesco all offer accounts that pay an attractive interest amount.

Do not look at only the interest rates, but look at such bonuses and perks as bonuses for opening an account, the amount of the monthly fee (if any), and any cash back schemes. Many banks offer cash back on direct payments made for utilities, broadband, and other regular services that can easily offset any fees and make up for a lower interest rate.

Be sure to read the rules that apply to the account.  Most have minimum pay ins. You will find a number of postings online as to how to get around some of the pay in requirements, but if it is published on the internet, the odds are the bank is also aware of the scheme. It is not worth the hassle or the potential problems trying to find a way to beat the system.

Best Banks for Opening a New Account

Basically you need two documents to open a UK Bank account; one that proves your identity and one to prove your address.  Most banks will accept your passport, driving license, or identity card as proof of identity.  The requirements for proving your address varies but generally include items like a recent utility bill, tenancy agreement, or a council tax bill. Some banks will accept a letter from your employer or a letter from JobCentre confirming your National Insurance number.

Here’s a look at some of the largest UK banks and the requirements to open an account if you are newly arrived in the UK.

  • Barclays

Barclays is one of the UK’s oldest banks and have a fairly relaxed policy toward new accounts. Basically a passport and any document that establishes your address will suffice.

  • Lloyds

Lloyds is the UK’s largest providers of current accounts.  You can open a new to UK account with just your passport.

  • HSBC

One of the biggest advantages of setting up an account at HSBC is their worldwide presence. If your home bank is HSBC they can actually help set up a UK account for you.

  • TSB

While it is not part of the big four of UK banks, TSB has a growing reputation as one of the UK’s best banks. Their new account process is considered to be fairly straightforward and simple.

2016-11-22

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