Basic bank accounts are a great first step for people learning -- or re-learning -- to manage their own money. If you have trouble getting an ordinary current account, a basic bank account could be your best option.
How basic bank accounts work
Basic bank accounts work like a normal current account in that you can have any wages, tax credits or benefits paid in directly. You can also get a debit card to withdraw and deposit money, and you should be able to set up direct debits or standing orders to pay bills.
Unlike normal current accounts, basic bank accounts do not offer cheques or overdrafts. This prevents the account holder from spending money that isn’t theirs, so there is no borrowing associated with the account. The only exception is with penalty charges: if you bounce a cheque or a direct debit, you will be charged by the bank, which could take your account into the red.
Basic bank accounts and bankruptees
Because they are essentially non-borrowing accounts, basic bank accounts are perfect for people who have just gone bankrupt. Unfortunately, only a handful of banks still offer accounts to bankruptees.
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