The best student bank accounts

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published 8 June 22

University students can take advantage of a number of perks, including interest-free overdrafts, railcards and restaurant discounts, by picking the best student bank account. We look at the top ones available right now.

With thousands of students set to take their A-levels, before heading to university from September, it’s a good idea to start thinking now about which student bank accounts will help you manage your finances and live independently for the first time.

We explain what makes student bank accounts different and what features you should pay attention to. Here’s everything you need to know.

Student bank accounts - what are they?

Student accounts are bank accounts which are exclusively offered to those in higher education - but they come with additional benefits, such as an interest free overdraft. Some overdrafts go up to as much as £3,000 without interest being charged. Other perks include railcards or membership schemes which help you save money when eating out.

Who can apply for a student bank account?

If you have been accepted onto a full-time UCAS course, you are eligible for a student bank account. To open one, you will need:

A UCAS confirmation letter with an unconditional offer
A letter from your university confirming your place if your offer is conditional

You can only have one student account and you must be a UK resident.

How to choose the best student bank account

Different banks and building societies will offer freebies to tempt you to open an account with them. Offers can include free products, travel discounts, cashback offers or subscriptions.

These might sound fantastic, but you need to think carefully about whether the overall package is worth it.

For example, a student bank account offering a freebie worth £50 is paltry compared to a large interest-free overdraft for three years that will potentially serve you well.

Meanwhile, a free railcard worth around £100 if you are not studying in your hometown will be a helpful saving and may be worth weighing up against a smaller overdraft.

You should double check if some of the perks are actually exclusive - can they be found on other accounts from the same bank? Banks will list bog-standard features which they offer to all customers ‒ such as a banking app or the ability to earn cashback ‒ as fantastic benefits of their student accounts.

Managing your money at university can be really difficult, which is why it’s a good idea to look at the largest student overdrafts available. Think about whether you will need it and for how many years you want it. An arranged overdraft is a useful way of borrowing money via a current account. Even if you don’t think you will need the full overdraft, applying for it means you will have peace of mind should you need to cover your rent while you are waiting for money to come in or fall on unexpected hard times.

Having an overdraft can also help to avoid the need for a student credit card. While credit cards may be the right option for you at some point during your student life, an interest-free overdraft is likely going to be a better option.

What are the best student accounts right now?

It’s important to do your own research to ensure a bank account suits your individual needs. To help you get started, here are some of the top deals available right now.

Santander 123 Student Current Account (opens in new tab)

Benefits:

A free four-year Santander 16-25 railcard that saves you a third on rail travel in Britain (excludes northern Ireland) and offers cheaper travel in London if you link it to an Oyster card. This railcard consistently scores highly with Which? And Money Saving Expert.
Up to 15% cashback from certain retailers like Just Eat and Costa
An interest-free overdraft of £1,500 for the first three years, £1,800 in the fourth year and £2,000 if you have a fifth year

Positives:

A four-year railcard isn’t even available from National Rail so this is a stand out offer. A one-year card costs £30 and a three-year card costs £70 so this four-year card is worth almost £100. The average traveller saves £189 a year with their railcard
This is the only account with a guaranteed 0% £1,500 overdraft

Negatives:

The railcard is not valid in northern Ireland

Barclays Student Additions Account (opens in new tab)

Benefits:

Cashback if you use online banking or the Barclays app
Blue Rewards which offers cash rewards for using your account and having direct debits can be added for £4 a month
A £1,000 interest-free overdraft in your first year, up to £2,000 in year two and £3,000 in year three
Access to Perlego (opens in new tab), an online textbook subscription service.

Positives:

One of the most generous overdraft offers
Lots of cash rewards like cashback that can add up over a three or four-year period

Negatives

You only get access to Perlego for a year, and only if you don’t already have a Barclays account.
It may not be helpful for the course materials you need, so check the website before making a decision via its offer of a free 14-day trial

Halifax Student Current Account (opens in new tab)

Benefits:

Interest-free overdraft of up to £1,500 for the entirety of your course, plus an extra year after you graduate up to a maximum of six years
Cashback extras such as 15% at the Co-op and Sky
Save the Change facility that allows you to round up your card payments when you spend and put the change into a Halifax savings account

Positives:

The generous length of the overdraft

Negatives:

No freebies
Cashback and Save the Change function are available across other Halifax accounts

Katie Binns

Katie is staff writer at The Money Edit. She was the former staff writer at The Times and The Sunday Times. Her experience includes writing about personal finance, culture, travel and interviews celebrities. Her investigative work on financial abuse resulted in a number of mortgage prisoners being set free - and a nomination for the Best Personal Finance Story of the Year in the Headlinemoney awards 2021.