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How to open a bank account online

Rebecca Webber

It’s almost impossible to go through life in the UK without opening a bank account, with many people opening their first account in their teens. Having a bank account is essential to receive wages from a job, or to pay bills by direct debits.

Nowadays virtually all employees receive their wages directly into their bank accounts. This is largely because it is easier administratively. It is also less of a security risk, especially for large businesses. It means a business does not leave itself a target for thieves by holding large sums of cash in the form of wage envelopes. It also means employees are not the target of street robberies as they do not need to carry a cash envelope of their wages.

The days of cash-in-hand payments after a day’s, or week’s work, are almost irradicated. Some people do however prefer to deal in cash such as a tradesman with a small team of employees. Employees may prefer to be paid for the work they do that day, rather than waiting until the end of the month. In some fields, this is the normal work culture, and employers oblige. This is also sometimes a way for employers and employees to try and dodge the taxman.

Whatever the case may be, nearly all wages are paid into a bank account. Those that receive cash are also still likely to use bank accounts as well. Online banking has also become more popular in recent years, as the global reliance on the internet continues. In 2022 it was estimated that 93% of UK citizens use internet banking.

In this article, we’ll take a look at the best ways to open a bank account online.

What information do I need to open a bank account?

Firstly you will have to reach a certain age before you can open up a bank account. The standard age someone needs to be is usually 18. However, some banks offer bank accounts to individuals who are 16 and over. Some banks also offer children’s bank accounts for those younger than 16. To open an account with a bank in this country you must be a UK resident. This is why you will need to provide identification before opening a current account.

Types of ID required to open an account include:

Furthermore, to open up a current account you will need to provide details of your residence. Proof of address can include:

To open a current account a bank will want to find out certain details about you. Much of this can be backed up by your documents. This includes:

They will also need your contact details (such as a valid registered phone number), and marital status

Can I be rejected when opening a current account?

In certain circumstances, you may be rejected from opening an account with a bank. First and foremost you may not have a suitable ID. However, if this is the case there are other options. You can sometimes use official documents to prove your identity if you do not have a photographic ID. This can include; benefits letters, immigration documents, a prison governor letter, a care home letter, a homeless shelter letter, or a letter from your place of study.

All bank accounts are subject to a credit check before being accepted. If you have a poor credit rating you may be rejected from opening a current account. Similarly, if you have a record of fraud or bankruptcy you may not be able to open a current account.

However, thanks to the Payment Accounts Regulations 2015 you will be able to open a basic bank account. The regulation meant that the nine biggest UK banks must offer basic bank accounts. These banks are:

This type of UK bank account is fee-free for standard operations, including a failed payment. This is to stop the account holder from running into credit debt. However, this also means you cannot set up an overdraft on your account.

What types of bank accounts can I open?

There are different types of bank accounts you may like to open depending on your personal circumstances. A current account is the most used type of bank account. Often there is no monthly fee, but unlike a basic bank account, you have added benefits such as an arranged overdraft. Current accounts can be set up and managed via online banking. Furthermore, you can use a mobile banking app to manage your bank on the go. Your mobile banking app can be used in conjunction with Google Pay, Apple Pay, or other apps to pay for items via a device.

You may also be able to set up a joint account for yourself and your partner. This means that you both have equal access to the account which makes managing household finances easier. When you open joint bank accounts it means you are financially linked to your partner. Your financial records are combined when a credit report is performed. This could enhance or damage your own personal credit score.

You could also open a packaged account. These types of accounts charge a monthly fee in exchange for added benefits. This may include:

Savings accounts are another online banking option. They are not designed for everyday banking. Instead, a savings account is designed for you to place money into long-term, in order to earn interest while you save. Usually, you will need a current account to set up a savings account. However, some services allow you to set up a new account for saving, without an existing account being attached to it. You can also open a savings account as a joint account. Also, if you have a sole account you can switch it to a joint account.

What are student or graduate accounts?

If you are in higher education you may be able to open a student UK personal account. The main benefit of this type of account is the arranged overdraft limit. Typically you are offered a large arranged overdraft limit without a high-interest cost. You could be able to borrow up to £3,000 interest-free. This is also often offered to graduates.

It is important to note however that the interest rate will not stay like this forever. Eventually, the student account will mature into a standard current account you will be liable for a monthly fee when repaying the overdraft. To make use of this benefit it would be wise to repay your overdraft before your account becomes a current account.

What is the process of opening an online banking account?

Perhaps the easiest way to open a new current account is if you already have an existing or old bank account. This is because you can use the current account switch service. The current account switch service streamlines the transfer of your current account to a new bank. You can use the current account switch service by visiting this link.

However, even if you are setting up a new account from scratch it is still a fairly streamlined process. Customers can sign up for an online bank account by visiting the bank’s website or by using their mobile app. As long as you have the above information you should not have any problems setting up a new account. Simply visit the best bank online and select the most suitable account for your needs.

After your internet banking registration, a credit report may run a credit report on you. This is especially likely if you open an account with an arranged overdraft. If you pass your credit report you will be issued a debit card – most likely a contactless visa debit card. This will be sent in the mail separately from your pin code. Your pin number will be sent separately to avoid fraud.

Opening an online bank account: Summary

Mobile banking and online banking are more prominent than ever. This is often administratively easier to pay wages, taxes, and to set up direct debits. However, there are still some that are holding out on the digitalisation of wages by paying cash in hand.

However, people use banking for more than just wages. As stated online banking makes setting up and managing direct debits easier, among other things. A number of key pieces of information are required for setting up current accounts.

The key information required is your age, nationality, identification, marital status, and residential status. To prove this you can use certain documents. This includes:
Passport

In certain circumstances, you may be rejected when trying to open up a current account. For example, you may have poor credit or a history of fraud or bankruptcy. If so you will have to apply for a basic account instead. All major UK banks have to provide basic accounts. This can be as an everyday bank account but it is limited. For example, you cannot set up an arranged overdraft.

You could also open up a joint account with your partner to make household financial management easier. However, opening up a joint account links you financially. This means one of the parties may have their personal credit score reduced or vice versa.

A packaged account gives you further benefits such as breakdown insurance in exchange for a monthly fee. You may also open up a savings-based account to accrue interest earnings whilst saving. Normally you need an existing account already in place, but some services allow you to open a savings account on its own.

A student account is open to students or sometimes recent graduates. The benefit of this is that you are often granted a large interest-free overdraft.

Internet banking customers will find it easier to open a new account if they already have an existing account. They can use the current account switch service to change their existing account to a new one. For others, the process is still relatively easy. Just select your preferred bank and the type of account that best serves you. Then fill in all the required details online and wait for a credit report to approve you or not.

If you are successful your debit card will be sent out to you. Your pin code will follow your debit card in a separate delivery to avoid theft. If you are not successful you can apply instead for a basic account.

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