Can you get a bank account with bad credit in the UK

If you have had debt problems, defaults or even bankruptcy, it is easy to assume that no bank will want you. But in the UK, the law and industry rules mean that most people can still get at least a basic bank account, even with poor credit.

This guide answers the most common questions about getting a bank account when your credit history is messy.

What is a basic bank account

A basic bank account is a stripped back current account designed for people who:

• do not qualify for a bank’s standard current account, or
• are trying to rebuild after serious money problems such as an IVA, Debt Relief Order or bankruptcy.

MoneyHelper explains that a basic bank account lets you:

• receive wages, benefits and pensions
• pay bills by Direct Debit or standing order
• use a debit card to pay in shops, online and at cash machines
• manage your money via online, mobile, phone or branch (depending on the bank)

Unlike most standard current accounts, a basic account does not offer an overdraft and must be fee free for everyday UK use under the Payment Accounts Regulations. You can read MoneyHelper’s overview here: https://www.moneyhelper.org.uk/en/everyday-money/banking/basic-bank-accounts

A government bulletin on basic bank accounts summarises that these accounts must:

• provide the same core payment services as a regular personal current account; and
• be free for standard operations in sterling; and
• have no arranged overdraft facility.

See the GOV.UK collection on basic bank accounts: https://www.gov.uk/government/collections/basic-bank-accounts

Which banks have to offer fee free basic accounts

UK rules mean the nine largest banking groups must offer a fee free basic bank account to eligible people who would not otherwise be able to get a standard account.

According to GOV.UK and FCA summaries, the nine designated institutions include major names such as:

• Barclays
• HSBC UK
• Lloyds Banking Group (including Halifax and Bank of Scotland)
• Nationwide Building Society
• NatWest Group (including RBS and Ulster Bank)
• Santander UK
• TSB
• Virgin Money
• The Co operative Bank

You can see the list and more detail in the latest government report: https://www.gov.uk/government/publications/basic-bank-accounts-july-2023-to-june-2024

The FCA’s report on UK payment accounts also confirms that these large institutions must provide a basic bank account without fees or overdraft for eligible personal customers: https://www.fca.org.uk/publication/corporate/uk-payment-accounts-access-and-closures.pdf

Other, smaller banks can choose to offer their own basic accounts too.

Can you get one if you have bad credit or are bankrupt

Yes, in most cases.

MoneyHelper and Shelter both stress that basic bank accounts are specifically intended for people who:

• have a poor credit history
• are in a Debt Management Plan (DMP) or Individual Voluntary Arrangement (IVA)
• have a Debt Relief Order (DRO)
• have been declared bankrupt

MoneyHelper explains that you usually qualify for a fee free basic account if you do not qualify for a standard current account because of financial difficulty or a poor credit score: https://www.moneyhelper.org.uk/content/dam/maps/en/everyday-money/fee-free-basic-bank-accounts.pdf

Shelter’s guide on basic bank accounts notes that you do not need to pass a full credit check and that these accounts are designed for people who have been refused other accounts: https://england.shelter.org.uk/housing_advice/benefits/basic_bank_accounts_with_no_credit_check

The key points are:

• your credit score can be very low and you can still qualify
• many banks will accept you even if you have had bankruptcy or serious arrears
• you will usually not be given an overdraft, which can be a useful safety feature if you are rebuilding.

Will they do a credit check and will it hurt my score

Most banks will do some kind of check, but it is not like applying for a normal loan or credit card.

Shelter and MoneySavingExpert explain that:

• banks often run a soft search on your credit file to confirm your identity and check for fraud
• a soft search does not affect your credit score in the way that a full hard search can
• some banks may still record that you applied, but for a basic account they are mainly checking who you are, not judging you as a borrower

MoneySavingExpert’s basic bank account guide summarises this as: you may see the check on your file, but it is not usually used to decide your creditworthiness for borrowing: https://www.moneysavingexpert.com/banking/basic-bank-accounts/

What can you do with a basic bank account – and what can you not do

From official guidance and bank product pages, typical features include:

You can usually:

• have wages, benefits and pensions paid in
• pay by Direct Debit and standing order
• withdraw cash at ATMs and Post Office counters
• pay by debit card in shops and online
• use online and mobile banking

You normally cannot:

• have an arranged overdraft
• go overdrawn on purpose – payments may be refused if you do not have enough money
• access some extra packaged account features (for example, insurance bundles or linked credit lines)

GOV.UK confirms that basic accounts must provide core services and must not include an overdraft facility: https://www.gov.uk/government/publications/basic-bank-accounts-july-2023-to-june-2024/basic-bank-accounts-july-2023-to-june-2024

Bank product pages, such as HSBC’s Basic Bank Account and the Co operative Bank’s Cashminder, show how this looks in practice:

• HSBC Basic Bank Account: https://www.hsbc.co.uk/current-accounts/products/basic-bank-account/
• Co operative Bank Cashminder: https://www.co-operativebank.co.uk/products/bank-accounts/basic-bank-account/

What ID do you need to open one

Citizens Advice explains that to open any bank account you usually need to prove who you are and where you live.

Common documents include:

• passport
• photo driving licence
• official letters or bills showing your address (for example, council tax bill, benefits letter, utility bill)

If you do not have standard documents, Citizens Advice says banks should consider alternatives, such as a letter from a responsible person (for example a GP, social worker or probation officer) confirming your identity and situation: https://www.citizensadvice.org.uk/debt-and-money/banking/getting-a-bank-account/

MoneyHelper’s fee free basic account leaflet also notes that if you are struggling with ID or proof of address, staff should work with you to find acceptable alternatives and you can complain if you think they are being unreasonable: https://www.moneyhelper.org.uk/content/dam/maps/en/everyday-money/fee-free-basic-bank-accounts.pdf

Can a bank refuse you a basic account

A bank can refuse to open a basic account in some situations, for example if:

• they believe you have used accounts fraudulently
• you refuse the identity checks they have to do under anti money laundering law
• you already have another account that meets your needs

However, guidance from MoneyHelper and Citizens Advice emphasises that the largest banks must offer a fee free basic account if you:

• do not already have a UK payment account, and
• do not qualify for a standard current account, and
• meet the basic eligibility rules (age, residency, etc.).

If you are refused, you can:

1. Ask for the reason in writing
   MoneyHelper says banks should usually tell you why they have refused, unless they suspect fraud or money laundering.

2. Try another bank
   Different banks apply their policies differently. MoneySavingExpert’s guide lists which banks currently offer good basic accounts: https://www.moneysavingexpert.com/banking/basic-bank-accounts/

3. Get help from Citizens Advice or a local advice agency
   Citizens Advice Scotland has reported cases where people struggling with ID or digital access have been wrongly blocked from basic accounts, and advisers were able to intervene: https://www.cas.org.uk/news-and-events/basic-bank-accounts-need-be-easier-people-open

If you believe you meet the rules and a designated bank still refuses you, an adviser can help you complain and, if needed, take it to the Financial Ombudsman Service.

What if your local branch has closed

Many high street branches have closed in recent years as banks push more people to use online and mobile services. Press reports and FCA data show hundreds of branch closures across major groups, with banks pointing customers towards:

• online and mobile banking
• local Post Office branches for basic cash and payment services
• new banking hubs shared between several banks

For example, coverage of branch closure programmes notes that customers can still access basic banking at over 11,000 Post Office branches and at new banking hubs that are gradually being rolled out.

This means that even if your nearest branch has gone, you can usually still:

• open or manage a basic account online or by post
• use the Post Office for everyday transactions like deposits and withdrawals

If you are not confident online, Citizens Advice and local community organisations can help you work through applications or find a nearby hub.

Can a basic bank account help you rebuild

MoneyHelper and the FCA both note that having a basic bank account can be a useful first step in rebuilding your finances after problems.

Benefits include:

• having wages and benefits safely paid in
• being able to set up Direct Debits, which can sometimes reduce bills
• starting to show that you can manage day to day money reliably

While a basic account itself does not give you credit, it can put you in a better position to move back to a standard account in future, once your situation and credit history improve.

Where to get help finding and opening a basic account

You do not have to do this alone. Good starting points are:

• MoneyHelper – guides and a comparison tool for basic and fee free accounts:
  https://www.moneyhelper.org.uk/en/everyday-money/banking/basic-bank-accounts

• Citizens Advice – help with documents, refusals and complaints:
  https://www.citizensadvice.org.uk/debt-and-money/banking/getting-a-bank-account/

• Shelter – guidance if you are homeless or in temporary accommodation and need an account:
  https://england.shelter.org.uk/housing_advice/benefits/basic_bank_accounts_with_no_credit_check

• Local advice centres and credit unions – some can help you open accounts or offer alternatives.

Key points to remember

• A poor credit history, IVA, DRO or bankruptcy does not usually stop you getting a fee free basic bank account.
• The biggest UK banks are required to offer basic accounts to eligible customers who cannot get standard current accounts.
• Basic accounts let you receive income and pay bills but do not provide an overdraft.
• You will usually face only a soft credit check that does not damage your score.
• If a bank refuses you and you think that is wrong, you can ask why, try another bank, and get support from Citizens Advice or a debt adviser.

Having a safe, fee free account is a foundation for getting back in control of your money – and UK rules are designed so that most people can get one, even after serious financial difficulties.