/ Money

Banks still tempt students with rubbish freebies

Young student writing sums on white board

Why did you choose your student bank account? Because of its massive interest-free overdraft, or because of its rubbish incentives? I’ll put a £10 iTunes voucher on it being the latter.

I’m still with the very same bank that I joined when I became a university student. You’d think I hadn’t grown out of the late-night partying, late-night revising, and afternoon napping. No comment.

The fact that I haven’t made the effort to switch to something better – I only get 0.01% interest on this bank’s savings account – is only the half of it. Years after I’ve graduated, I’m still with the bank I chose because of a little student account incentive – a five-year young person’s railcard.

At the time, the railcard was actually a really good perk for me – it would have cost around 120 smackers back then. And since I often travelled back home (down south) from my uni in Nottingham, it more than paid for itself over five years of discounts.

Most students fall for lame incentives

What’s worrying is that from the 1,000 students we asked, 70% chose their current account either because of incentives or because they knew a family member with the same bank.

My bank choices have been just as fickle – I’ve got another account just because my gran set it up to put in a few bob to help me through uni. Oh, and I’m with a third as I wanted free cash withdrawals while studying in Australia.

As for these student account incentives – some aren’t even worth your attention. A free student card? You get one when you join uni anyway. A discount on a mobile phone? Please.

Look for the massive overdraft limit

What should really inspire our choice of student account is the size of its interest-free overdraft. Because at the end of the day, all of us will be in a pile of debt when we leave uni (I’m still paying off the £15,000 I graduated with five years ago) and a larger interest-free overdraft can really limit the cost of going into debt.

My account’s overdraft limit didn’t cross my mind when I opened my account – only that little plastic railcard. And I’m not the only one – only one in five of the students we asked thought about overdrafts.

But I was one of the lucky ones – my bank’s overdraft limit turned out to be pretty good, and hell did I need it.

Got a question about managing your money at uni? Read our expert Q&A and ask our student money expert a question here.


I’m going to Uni in about a month, should probably get my account sorted!

Great advice, thanks!

I chose the Bank because it was closest to the Uni I went to – It actually was very understanding of my student problems and I never even thought about “incentives” .

But I never changed the branch or Bank until I noticed “sundries” charged – which on enquiring – were always refunded.

Now it is First Direct because of superb service – but am thinking of removing my considerable savings due to ludicrously low interest rates.