If you have teenage children heading off to university this autumn, or if you’re going yourself, it’s well worth setting up a student bank account in advance.

These accounts come with great benefits for those in higher education, with providers often throwing in a few extra perks to increase their pull.

But with so many options out there, it can be hard knowing where to start. That’s why we’ve put together this guide to student bank accounts, including our list of the best accounts for students starting university in autumn 2023.

What is a student bank account?

Student bank accounts are, as their name suggests, bank accounts designed specifically for those in higher education. These are generally aimed at undergraduates on courses lasting at least two years but usually three, four or five years. They are often also offered to postgraduate students, those on BTEC courses, and those on higher level apprenticeships.

In addition to the usual banking services, student accounts generally come with a large interest-free overdraft. An overdraft can be a really useful thing for a student to have, as it can give them a bit of a financial cushion if, say, they are waiting for their next student loan payment to come through and have no money in the meantime.

With many student accounts, your child will start off on a certain zero-interest overdraft limit, which they can ask to increase in subsequent years. For example, a student on a NatWest student account will start off with a £500 overdraft in their first term, but can ask for this to be increased to £2,000 afterwards. Most of these increases will be subject to a credit check, but your child will usually be accepted for these, unless they seriously damage their credit score at university.

If your child has a bank account already then their provider may well contact them in the months leading up to the start of their course to ask if they would like to switch to a student bank account. There’s no obligation for them to stick with their current provider, however, so it’s a good idea for you to help them look for the best account available and weigh up the incentives.

Bear in mind that in order to apply for a student bank account, your child will need not only their usual identification and proof of address but also proof of acceptance to their course.

We’ve listed some of the best options currently on the market below.

Which are the best student accounts for 2023/24?

Santander 123 Student

Available to: First-year students or any student with at least two years of study left, or those starting a level 4-7 apprenticeship.
0% Overdraft:
– £1,500 in years 1 to 3 (must pay in £500 each term)
– £1,800 in year 4
– £2,000 in year 5
Other features: Includes a free four-year 16-25 Railcard.
Apply: Online at Santander.

Natwest Student/Royal Bank of Scotland Student

Available to: Anyone on an undergraduate course of at least two years or a full-time postgraduate course, or training to be a nurse.
0% Overdraft:
– £500 in the first term
-£2,000 until the end of second year (increase must be requested, subject to approval)
-£3,250 in years 3+ (increase must be requested, subject to approval)
Other features: £100 cash paid into the account and a free four year Tastecard to get discounts and deals at certain restaurants.
Apply: Online at Natwest or RBS.

HSBC Student

Available to: First year undergraduates and first year postgraduates, plus those on certain BTEC courses.
0% Overdraft:
– £1,000 in year 1
– Up to £2,000 in year 2 (increase must be requested, subject to approval)
– Up to £3,000 in years 3+ (increase must be requested, subject to approval)
Other features: £100 cash paid into the account provided you use the debit card five times in the first 30 days, plus a year’s free subscription to meditation app Headspace.
Apply: Online at HSBC.

NationWide FlexStudent

Available to: Those on a UCAS-registered course of at least two years. You can apply up to one year after your start date.
0% Overdraft:
– Up to £1,000 in year 1 (subject to approval)
– Up to £2,000 in year 2 (increase must be requested, subject to approval)
– Up to £3,000 in years 3+ (increase must be requested, subject to approval)
Other features: £100 cash paid into the account, provided you have paid in £500 by December 2023.
Apply: Online at NationWide.

What happens to a student bank account when the course ends?

A student bank account automatically reverts to a normal bank account when the course ends. Your child may get to keep their interest-free overdraft for a while after graduating, and will notify you when it reduces.

More financial tips for parents of new students

If your child is heading off to university soon, it’s likely that it will be their first time being somewhat financially independent. This could make it a great time to sit them down and make sure they understand some key financial concepts so they make the most of their money – read more in our article Eight essential money lessons to teach your teenager.

If you are helping your child weigh up the different ways of paying for university this year or in the future, check out our guide What’s the best way for your child to pay for university? Or, if you are considering helping them out financially but aren’t sure how, our article How to help student children or grandchildren financially contains some useful ideas.

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