Compare Bad Credit Current Accounts

Can I get a bank account with bad credit?

It is possible to get a bank account if you have a bad credit history or no credit history at all.

Some banks and building societies offer specialised current accounts designed for people with bad credit. These are called bank accounts for bad credit, bad credit bank accounts or no credit check accounts.

Bank accounts for bad credit offer everyday banking services such as setting up direct debits, online banking and making deposits and withdrawals.

A handful of bank accounts for poor credit also offer an overdraft, but these tend to have a high arranged overdraft interest rate and a bank account fee.

» MORE: FInd out the different types of current account and what they offer

What type of bank account can I get with bad credit?

The main type of bank account you can get with bad credit is a basic bank account. Basic bank accounts offer everyday banking services including deposits, withdrawals and making payments.

You can also get a basic bank account with no credit check. This is because basic bank accounts don’t come with an overdraft so you won’t be borrowing money from the account provider.

The other type of account you can open is a prepaid bank account. This allows you to add money to a card that can be used for everyday spending in store or online. If your account runs out of money, it must be topped up before you can start spending again.

Can I get a bank account with an overdraft if I have bad credit?

There are only a few providers that offer a bank account with an overdraft if you have bad credit.

That’s because an overdraft is a form of credit and you are borrowing money from your bank. So whenever you apply for an overdraft, a bank will use a credit check to look at your credit history and see whether you are a reliable borrower.

It is possible though, and there are a very small number of providers that offer overdrafts to customers with poor credit histories. However, these accounts tend to have a monthly fee and charge a higher level of interest for an arranged overdraft.

» MORE: Find out what an overdraft is and how they work

Can I get a bank account with an overdraft and no credit checks?

A bank or provider will always run a credit check before giving you an overdraft. That is because an overdraft is a form of borrowing, so your provider will need to check whether or not you are a reliable borrower and will be able to repay your overdraft.

Can I get a debit card with a bank account for bad credit?

Most bank accounts for bad credit come with a debit card. Some providers offer e-accounts that are managed online only and don’t come with a physical debit card. These accounts are mainly for managing your bills and setting up direct debits.

Features of a bank account for bad credit:

The features and services of bank accounts for bad credit vary between providers but most typically offer:

• debit card
• contactless payments
• accepting payments
• setting up direct debits
• access to a prepaid card
• buying items online
• taking out cash from an ATM
• access to mobile apps to help manage your money
• tools to help you build up your credit rating

Bank accounts for bad credit don’t usually include the following features:

• interest on your balance
• fee-free spending abroad
• free ATM withdrawals
• overdrafts

How to open a bad credit bank account

Most providers let you open a bank account for bad credit and will ask for the following information:

• Personal details: name, date of birth, address, contact information
• Financial information: employment details, income, expenditure
• Proof of identity: passport, driving licence

Benefits of a bank account for bad credit

Bank accounts for bad credit offer several benefits including:

• No credit checks: Bank accounts for bad credit are more financially inclusive and give customers with poor credit histories the chance to access everyday banking services.
• Improving your credit score: Setting up regular direct debits from your bad credit bank account to pay your bills on time shows lenders that you are a reliable borrower and can help boost your credit score.
• FSCS protection: Some bad credit bank account providers are covered by the Financial Services Compensation Scheme (FSCS), which protects up to £85,000 of your money if they go bust.

Disadvantages of a bank account for bad credit

• Limited features: Bank accounts for bad credit provide limited banking and payment services. They don’t offer features such as cashback and rewards or earning interest on your balance.
• Account fees: Some bad credit bank accounts charge a monthly fee, which ranges from around £6 to £15.
• Expensive overdrafts: If you find a provider that offers overdrafts for bad credit bank accounts, they will have more expensive overdraft rates than regular current accounts. That is because there is a higher risk of borrowers with poor credit histories not repaying their overdrafts.

Are there fees or charges involved with a bad credit bank account?

Some of the common bad credit bank account fees to look out for include:

• Account fees: Some providers charge a monthly fee to keep a bad credit bank account open.
• Overdraft fees: You will have to pay interest on an arranged bad credit overdraft if you are able to get one with your account.
• Transaction fees: You may have to pay a fee for payments made in a foreign currency.
• ATM fees: Some providers charge a fee if you need to withdraw cash from a cash point.

CAlternatives to a bad credit current account

You may be able to get a bad credit bank account from a credit union.

Credit unions are not-for-profit organisations that are owned and controlled by their members. They usually offer their members financial services such as loans, mortgages and savings accounts.

Some credit unions also offer their members current accounts. These accounts provide basic banking services for free but may charge a monthly fee to offer services such as an overdraft.

» MORE: Find out how credit unions work and where to find one

How does Nerdwallet’s bad credit accounts comparison work?

It is still possible to open a bank account if you have poor credit. Our comparison table shows the features and services offered by each bank account for bad credit as well as some of the fees you need to pay.

You can use our account breakdown to compare each bad credit bank account and decide which one could help you manage your money and improve your credit score, then click through to the provider. Always check the full terms and conditions of a product before proceeding.

Bad Credit Bank Accounts FAQs