Students are constantly beset with money concerns. With all the loans, overdraft teetering and high living expenses, most of them unfortunately struggle to get by. In 2015, a survey showed that 40% of students go without food because of their money concerns, which is obviously a staggering statistic. When bad credit gets thrown into the mix too, their situation gets even worse.
Bad or small credit means students can’t access financial help and services that would otherwise help them get back on track with their finances. It’s a sign to banks and lenders that the bad credit holder is not good with money, and therefore cannot be trusted.
Consequently, here’s how students can open a bank account with bad credit.
What You’ll Need
Regardless of whether you’ve got good or bad credit, some rules are the same and you’ll always need the same few things when applying to open a bank account. After all, any big life changes require the big and most important items in your life; those related to formal identification!
You’ll need two forms of ID (e.g. your passport, drivers’ licence or birth certificate), proof of address so they know where to route utility bills too, and proof of your student status. For the latter, you can take along a UCAS offer or a student card your university may have issued to you. Don’t forget any of these; they’re all essential to you setting up any kind of account!
Try the Student Account
At first, you should try go get yourself the standard student account. Even if you’ve got bad credit, try anyway as you have nothing to lose. It may be that they’ll permit you to have an account without an overdraft extension, which means that you’ll have no wiggle room to be able to overspend at all. Also try asking different banks, some may be more accommodating than others, etc.
Their decision-making process is very complex as to whether they’ll give you an overdraft account. It’s not just about bad credit, and it can also depend on the size of your loans or if you’re enrolled on anything like a scholarship. Who knows, you could get lucky? Still, if you do have no luck here, you’ll need to go for the basic bank accounts for your monetary needs.
The Right Services
Not every account provider turns its back on those with bad credit. Some recognise that people deserve a second chance or a helping hand and are willing to go out on a limb in that regard. It’s trusting and kind, and while this kind of service is exceptionally rare and hard to come by, they most definitely exist!
For example, Think Money generously provide current accounts for those with bad credit, even if the user has been rejected elsewhere. It can be accessed online and helps users pay all their bills in order to repair their waning credit scores. There’s no overdrafts or unexpected charges; just a helpful safety net to help out anyone, including struggling students, in their times of financial need.