Current Accounts Overview

Definition

• A current account is a bank account used for day-to-day banking.

Types of Current Accounts

1. Standard Account
   • Advantages:
     • No charges on credit balances
     • Range of facilities: debit card, overdraft, checkbook
     • Convenient for receiving wages and withdrawals
   • Disadvantages:
     • Potentially high charges on overdraft facilities
     • No additional perks or features
2. Basic Account
   • Advantages:
     • Available for customers with a low credit rating
     • Easy first step for banking
     • Ability to pay in and withdraw cash
   • Disadvantages:
     • Very limited facilities (may lack debit card and overdraft)
3. Student Account
   • Advantages:
     • Ideal for managing course fees and loans
     • Additional perks tailored for students (e.g., rail card, discounts)
   • Disadvantages:
     • Overdraft facilities may encourage overspending
     • High charges for overspending
     • Limited facilities compared to a premium account
4. Premium/Package Account
   • Advantages:
     • No charges on credit balances
     • Similar facilities to standard accounts
     • Additional perks: travel insurance, breakdown cover, phone insurance
   • Disadvantages:
     • Additional monthly charge (e.g., £6/month)
     • May not be cost-effective if perks are not utilized

Conclusion

• Understanding the differences between current accounts can help you make an informed decision about which account to open based on your needs and financial situation.