Opening a Bank Account. Information on different types of accounts and what they offer.

Transcription

1 Opening a Bank Account Information on different types of s and what they offer. May 2014

2 Why open an? Soon all benefits will have to be paid into a bank. Having money paid into an is safer you will receive your money quicker. If you are looking for work or in employment, most employers now insist on paying wages into an. You can save money by paying your bills through your. Helps you keep track of how much you are spending through receiving regular statements or you can access online banking using smart phone apps. Will I be able to open a bank if I have a poor credit history? Usually your credit history will be checked before any of these s can be opened, but poor credit history should not prevent you opening a basic bank. How long will it take for a bank to be set up? It should not take more than 10 days to have the up and running, provided there are no problems with your identification and verification documents. If you require any advice or assistance with opening a bank please contact: The Advice Hub, 1 st Floor, Marland House

3 What do I need to open a bank? Most banks need you to provide two different documents one to prove who you are, and one to prove where you live. The most useful documents are: 1. A UK or EEA passport or a photo card driving licence. 2. A recent bill (gas, electricity, council tax, but no mobile phone) showing your current address. 3. A recent benefit decision letter. If you don t have any of these documents, there are other ways to prove your identity and each bank has flexible procedures for accepting certain other documents. You can discuss this with staff at any of the banks. Check with each individual bank to see which documents they require to open an. Make sure all the documents you provide have the same spelling of names and same address. Make sure any document, such as a bill, is the most recent available. All banks take a copy of your documents and give the originals back to you. The Advice Hub can give you a form that you can take to your local bank which will guide you through the process of opening a basic bank. What type of should I open? There are a number of different s available these include: Basic bank Current Credit Union

4 Main features and services of different s Features Basic Bank Account Current Account Pay bills & withdraw money from a cash machine Direct debits and standing orders can be set up Receive wages/benefits directly to this Debit card given which can be used in shops & cash machines * Good option if you have poor credit history or no income Possibility to get a cheque book Refusal of an if you have debts of more than 500/outstanding court judgement against you Simplest bank to open and manage Manage online/mobile banking Cheque book Regular bank statements showing payments & balance. No money needed to open the Allows interest to be earned on the money you have Overdraft facility No fees to pay Charge for but they offer rewards, cash back & good interest rates * All basic s shown in this leaflet

5 Banking terms explained Standing order: a way of making regular payments to someone which is arranged with your bank. If there is not enough money in your to send the standing order, most banks will charge a fee. Direct debit: a way of paying bills. You arrange this payment with your supplier and give them your details. If there is not enough money in your to send the direct debit, most banks will charge a fee. Overdraft: An authorised overdraft is one that has been agreed with your bank. You are allowed to borrow up to a pre-set overdraft limit. Normally you re charged for using the overdraft although how much you pay and the type of fee may vary from bank to bank. Exceeding your authorised overdraft limit, or going into the red when the bank has not agreed an overdraft limit, is known as an unauthorised overdraft and should be avoided at all costs. Debit card: a plastic payment card which is linked to your and is used to pay for goods and services. It also allows you to withdraw money from cash machines or get cash back from shops that offer this service. Prepaid debit card: money can be loaded up in advance and used like any other payment card in shops or online and most work at cash machines too. The card isn t linked to a bank and you can only spend the money you put on it, so you can t go overdrawn or run up debt.when the money runs out you top up the card, just like a pay-as-you-go mobile phone. Cash card: a plastic payment card which only allows you to make cash machine withdrawals. It doesn t allow you to pay for goods and services in person, online or over the phone. Online banking: enables you to perform banking activities via the internet. Such as transfers, balance enquiries, bill payments, managing direct debits and standing orders and some even offer online loan and credit card applications. Account information can be accessed any time and can be done from anywhere.

6 Cardiff & Vale Credit Union Savings Account Save by standing order from your bank/building society, using a membership card at any Post Office or PayPoint outlet, by Cheque or cash at office, debit or credit card by telephone/online. Interest is paid on savings in the form of an annual dividend (subject to profit). If you are a member of the Cardiff & Vale Credit Union you have access to affordable loans. Cardiff & Vale Credit Union Rent Account Savings can be withdrawn by contacting the office, by BACS transfer to your bank/building society, cheque payable to yourself/third party or open cash cheque which will be made payable to you. Income can be paid into your by standing order. Make payments at Post office, Paypoint, telephone or with Credit Union payment card. 5 per month handling fee (your landlord could enter into the agreement with the Credit Union to cover this fee). Rent is set aside from regular savings in the and can be paid directly to your landlord. Payments can be arranged to your landlord by informing how much to pay and how often. Interested in a Cardiff & Vale Credit Union? Please contact: 1st Floor, Advice Hub, Marland House, Cardiff, CF10 1PN Tel info@cardiffcu.com Website: Rent is set aside and remaining funds can be transferred into a bank, cash a cheque or you can apply for the prepaid card.

7 Post Office Card Account Advantages and disadvantages of this Specifically designed for receiving pensions, benefits and tax credits which are credited directly to your Your bills can be paid by cash, card, cheque, Postal Order or Post Office Budget Card If you need to pay bills, add credit to your mobile phone or top up your gas or electricity you can go to your local Post Office branch either over the counter or at a paystation If you take your bill, mobile E Top-Up card, gas card or electricity key to your local branch and tell them how much you want to pay the Post Office will sort everything out and give you a receipt for your payment No other income can be paid into this, eg your salary Only withdraw cash or check your balance at a Post Office branch Can t set up automated bill payments such as direct debits and standing orders Soon all benefits will have to be paid into a bank and you ll be responsible for paying your own rent and won t be able to pay your rent by direct debit or standing order. No credit checks, overdraft facility or charges on the Website:

8 Different types of basic bank s Bank Name Name of Min age Standing Order & Direct Debit Charge for unpaid Direct Debit or Standing Order Barclays Cash card 18 Yes 8.00 Co- Operative Cashminder 16 Yes Halifax Easycash 16 Yes 10 (max 3 per day) HSBC Lloyds Bank or TSB Nationwide Basic bank Cash Flex Cash Card 18 Yes Yes (max 3 per day) 18 Yes Natwest Basic 18 Yes 6.00 (max in any charging period) RBS Basic 18 Yes 6.00 (max in any charging period) Santander Basic current 16 Yes This information is correct as at time of print, but is subject to change. Please check with your chosen bank or building society