The best 0% overdrafts and freebies for students.
Choosing the best student bank account is typically about finding the one with the best benefits, such as the size of the interest-free overdraft, then other things, like money management tools, freebies and what’ll happen when you graduate.
Here are the best bank accounts for students in 2023 and what they offer.
How to choose the best student bank account
I write a lot on the blog about the best bank accounts, but picking a student bank account is very different.
I chose my bank at uni, many years ago, because it was one of two or three on campus. In the late 90s it was really useful to have easy access to your bank so the location was important.
It’s very different today. For a start you can manage everything online so locality hardly makes a difference. Instead, current students should choose an account that’s going to be worth the most to you.
Though freebies might seem the most appealing, it’s better to focus on the size of the interest-free overdraft.
It’s also worth noting that most accounts are designed for three-year courses, so check the terms — especially for the overdrafts — if you have a longer degree.
When looking at your options, these are the key questions to ask.
How big is the 0% overdraft?
A 0% overdraft could be essential to help you get through your time at university. You won’t be charged any interest on the money in there, making them the cheapest way to borrow money.
Of course, you need to be careful about using it and not treat it as free cash as you will have to pay it back. You will generally have a few years after you graduate (and hopefully start working) to do this, but even so, don’t spend this money just because it’s available.
The lengths of 0% overdrafts change between the banks – and you might not even get the advertised amount. If the wording says the overdraft is “up to” that means you might not get the high sum mentioned in the adverts.
But it might be best not to go for the largest amount, as the bigger the overdraft the bigger the temptation to use it all. Instead, work out how much you think you’ll need to use and ask for that.
Plus, even if you think you won’t need one at all, it’s worth choosing a bank that offers one and applying for it at the start – you never know how things could change.
Some banks will also increase the size of overdraft each year, though you often have to ask. This means you can’t blow it all in the first year.
However, there could be conditions attached to having one of these fee-free overdrafts, so make sure you read all the T&Cs upfront. It could be something like pay in £500 every term.
There’s also the chance you could get rejected for the overdraft so check your credit file before applying. Most students won’t have much on their file, but it’s worth making sure there’s nothing wrong on there.
And of course, if you spend more than your overdraft allows you may be hit with huge interest charges of around 40%.
What freebies are available?
When I was starting uni, all the banks had some kind of freebie in an attempt to draw you to them over other banks. I got a free Railcard.
Some of these could save you a fair bit of cash, if you’d have bought them anyway, that is. These should generally be a second deciding factor once you’ve looked at overdraft options.
It also pays to check how much these freebies would cost if you looked around for extra deals and discounts. Often the value advertised is much higher than you’d actually need to pay.
Banks are mostly offering cold hard cash this year, typically £100, so you can spend it however you like.
What happens after you graduate?
Banks go all out for your business as a student as they know there’s a good chance you’ll stick with them for the rest of your life – and that’ll make them money.Don’t. Once you’ve graduated you can move your account. That could be for a better graduate account, bank switching cash or other rewards. You can see the types of offers currently on offer here.
The best bank accounts for students
Here’s our pick of the best accounts to get. You can only have one student account at a time, usually, but you can open up additional standard bank accounts on top.
You’re also able to switch from your student account to a new one if you want to change banks mid-degree. However with most, you’ll be subject to a credit check, so don’t apply for these too close to each other.
|Natwest & RBS||Student Bank Account||Years 1 & 2: Up to £2,000|
Year 3: Up to £3,250
|£100 and a 4-year tastecard|
|Nationwide||FlexStudent current account||Year 1: Up to £1,000|
Year 2: Up to £2,000
Year 3: Up to £3,000
|Santander||123 Student||Years 1-3: £1,500||4-year Santander 16-25 Railcard|
|HSBC||Student Account||Year 1: Up to £1,000|
Year 2: Up to £2,000
Year 3: Up to £3,000
|£100 cash and a 1-year Headspace subscription + up to £25 cashback|
Up to £3,250 overdraft: Natwest or RBS Student Account
Perk: £100 cash and a 4-year Tastecard
The interest-free overdraft is up to £500 in the first term and then up to £2,000 after this. You can get up to £3,250 in the third year. By offering you an increasing amount you’ll be able to budget more efficiently and reduce the risk of blowing it all in Freshers’ week.
Natwest and RBS both also offer £100 cash and a free 4-year Tastecard (worth around £35 a year). If you don’t go for this account there are other ways to get cheap or free dining discount memberships.
NatWest/ RBS Student Account
|Overdraft||Up to £500 in the first term, up to £2,000 in the first year then up to £3,250 in the third year.|
|Opening offer||£100 and a four-year Tastecard|
|Bonus paid||Within 10 working days of meeting criteria|
|Requirements||Open an account between 3 July 2023 and 30 November 2023|
|Not have had a student offer from NatWest since 1 July 2020|
|Lived in the UK for at least three years|
Up to £3,000 overdraft: Nationwide FlexStudent
Perk: £100 cash, one of the largest overdrafts and top ethical choice
The Nationwide student account offers £100 if you open an account after 1 August 2023 and pay in £500 by 15 December 2023. You can’t have had a FlexStudent or FlexGraduate account on 31 July 2023.
This also has one of the largest overdrafts over the course of the degree (NatWest offers up to £3,250 and HSBC also offers up to £3,000) The overdraft builds gradually over your degree, stopping you from blowing it all in one go.
This is probably the best student account in 2023 due to its large interest-free overdraft and the cash perk. It’s a good choice if you’re worried about the ethics of your bank, too.
|Overdraft||Up to £1,000 in year one; up to £2,000 in year two; Up to £3,000 in year three|
|Opening offer||£100 cash|
|Bonus paid||14 days after meeting criteria|
|Requirements||Open a new FlexStudent account no more than five months before and 12 months after starting your course|
|Deposit £500 by 15 December 2023 (for the £100 bonus)|
|Deposit £500 every term (for the overdraft)|
|Not had an open FlexStudent or FlexGraduate account on 31 July 2023|
|Have been a UK resident for three or more years|
Guaranteed overdraft: Santander 123 Student
Perk: Free 4-year railcard
The Santander 123 Student account offers a guaranteed £1,500 overdraft for the first three years, so it’s a decent option if you want certainty on how much you can borrow. If you study longer it increases to £1,800 in year four and £2,000 if you stay on for a fifth year.
You also get a free four-year 16-25 railcard, a nice option if you are likely to be travelling by rail a lot as it knocks a third of train fares but I’d opt for hard cash instead.
Santander 123 Student
|Overdraft||£1,500 in years one to three, £1,800 in year four, £2,000 in year five (if still studying)|
|Opening offer||4-year 16-25 Railcard (worth up to £100)|
|Bonus paid||Within 5 working days you’ll get a code to redeem for the railcard|
|Requirements||Deposit £500 every term|
|Have proof of an accepted or unconditional offer|
|Live in the UK for tax purposes|
Up to £3,000 overdraft: HSBC Student Account
Perk: £100 cash and a year of Headspace + £20 cashback through Quidco
The HSBC Student Account has an overdraft of up to £1,000 overdraft in the first year, but you can get up to £1,000 added to your limit further up to £1,000 increases in the second and third year, though you’ll have to ask for it.
Like other banks, there’s £100 thrown in on top, so it’s another decent option to consider. The additional subscription to Headspace is nice to have but don’t factor it into any decision-making.
You can get an extra £2t cashback if you sign up through a cashback site, detailed below.
HSBC Student Account
|Overdraft||Up to £1,000 in year one, up to £2,000 in year two, up to £3,000 in year three|
|Bonus paid||Within 30 days of meeting criteria|
|Extra cashback||Up to £25 via TopCashback or Quidco (details)|
|Requirements||Open the account after 16 June 2022|
|Make 5 debit card transactions within 30 days|
|Deposit £500 every term|
|Not had an HSBC Student Account on or after 1 July 2020|
|Lived in the UK for at least three years|
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Other student accounts
It’s worth checking out these accounts too, some of them offer good overdrafts, but they mainly offer freebies. These might seem more attractive than 0% overdrafts, but if you do need to borrow, an overdraft is probably worth more.
If you’re really not bothered by an overdraft then it’s still worth nabbing one and putting that cash in savings.
|Lloyds||Student Current Account||Years 1-3: Up to £1,500||£100 cash|
|Halifax||Student Current Account||Years 1-3: Up to £1,500||£100 cash|
|Barclays||Student Additions Account||Year 1: Up to £1,000|
Years 2 & 3: Up to £1,500
|1 year of Perlego|
|TSB||Student Bank Account||Years 1-3: Up to £1,500||N/A|
|Co-op||Student bank account||Year 1: Up to £1,400|
Year 2: Up to £1,700
Year 3: Up to £2,000
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How to get a student bank account
You have to be over 18 and living in the UK to get any student bank account, and most will require you to be at the start of your first year to get the freebie.
You’ll need to show ID such as a passport, driving licence or birth certificate. You’ll also need to bring along proof of your acceptance to the uni or college – possibly your UCAS letter or university acceptance letter.
You don’t need to wait until you get to your university to open the account, so doing it now before you head off means you can get your bank card and PIN sent out and your online banking set up in advance.
Can I have more than one student account?
Most of the time you can only have one “student” account, this is usually laid out in each bank’s T&Cs – you’ll likely not get the perk or overdraft if you try and attempt it.
You could potentially open one of these accounts to get the freebie, then close it down and open up another one (or switch it). You’ll need to do this within the stated timeframes to get any perks, and it’s worth double-checking the T&Cs of each account to make sure you’re allowed.
There’s nothing stopping you from opening another bank account that’s not got the “student” perks – keep reading for more on these.
Can I switch my student bank?
You can switch your student bank account to any other account of your choosing, whether that’s another student account with another bank or a standard current account. This is as long as the bank is part of the Current Account Switching Service.
In some cases, this can get you an extra perk, so it could be worthwhile.
If you want to switch after you’ve graduated, this is possible too, just be careful about trying to switch if you’re overdrawn, as you may wind up paying overdraft fees.
Can I earn interest on my savings?
Though some of the student accounts will offer interest on money in the account, they are quite limited and not a reason to pick one account over another.
However, if you think you’ll have more money available or don’t think you’ll need to use all of your overdraft, then you could look at other savings accounts offering up to 7%.
Just be careful not to lock it away if you think you’ll need to access your savings.
Could you stooze your overdraft?
Stoozing is where you borrow money at 0% and put that cash into savings. Normally it’s via a specialist credit card – but you don’t need to do that when you have an interest-free overdraft.
To take advantage you simply transfer the money from your current account to a top-paying savings account. Putting £1,000 into a 5% paying account will earn you £50 in interest in a year.
If you’re confident you won’t need to use the money at all then you can get higher rates by fixing your savings.
If you do this, make sure you have enough cash in the bank to cover your everyday spending.
Alternative to student accounts
The bulk of the specialist student current accounts will have perfectly decent apps. But if you want one that’ll help you budget or have more advanced features you’ll want to look at digital banks Starling, Chase or Monzo.
They have a number of features that will help you do things like keep track of your spending, split your money by purpose (e.g. bills, going out, groceries) and it’s also a lot easier to set alerts for when your balance is getting low.
However, none of these offer specific student accounts and therefore don’t have a 0% overdraft. Instead, they could be a good secondary account alongside a high-street bank, getting you the best of both worlds.
I suggest using one of these as your day-to-day bank or everyday spending, transferring over a set amount to spend each week from the student account with an overdraft.
They’re also decent bets for spending abroad, whether studying overseas or on holiday.
You don’t have to stick with just a student account. You can open one with other features at another bank to use in addition.
My top pick is Chase Bank thanks to the 1% cashback you’ll earn on most spending. It only performs a soft credit check, so it should be easy to get it in addition to your main student account.
You could also consider Starling or Monzo, though you won’t get the cashback.