Student Bank Accounts Explained: My Tips and Experience

Student bank account benefits

Banks are eager to get your custom, and to do this, they’ll compete with each other to offer you the best sign-up bonuses they can. For example, when I applied in 2025/26, Nationwide were offering £10/month in Just Eat vouchers, as well as a tidy £100!

However, I’d suggest looking past these instant rewards, at other factors – such as how much overdraft an account will offer you. Overdraft cab be an incredbily useful tool for the financially savvy student, if used well. I’ll go further into detail about this later on.

Types of rewards

The types of rewards offered by a student bank account will vary, and currently at the time of writing, only two providers are still offering incentives – NatWest and Santander (MSE). Banks will likely start coming up with new offerings come the next freshers period – so it’ll be worth checking what each one offers then.

As an example, in 2025/26 offerings such as cash incentives, railcards, tastecards, and food delivery vouchers were all available, as well as overdrafts.

Railcard

Railcards are useful for travel, especially if you’re going to be a student far from home, and expect you’ll need to travel back fairly often – getting you a third off of your rail tickets.

Tastecard

I have a tastecard, although I can’t say I’ve ever really used it – I don’t dine out as much as I thought I would. It was free, so I can’t really complain, and the option of getting 2 for 1 meals or 25% off the bill at 1000s of restaurants is always there, if I ever do want it.

Food Delivery Vouchers

Food delivery vouchers, in my opinion, are a great incentive (although not as good as a cash incentive!). Nationwide offers £10 of Just Eat vouchers a month, although these must be claimed every month, or they’ll expire. They also offered an extra £20 for you and a friend if you referred someone – although, annoyingly, they stopped running this scheme before I could jump onto it.
I also believe Lloyds offered food delivery vouchers as well – but there was a minimum number of debit card transaction a month to be eligible, and since I prefer to spend on dedicated rewards cards, I never went for theirs.

I’m a huge fan of these – especially if you’re not in a catered hall, being able to get cheap(ish) food quickly is really useful, especially on the weekends. Just Eat occassionally send me emails offering me £10 off of a £15 spend, or 80% off of a £15+ spend, which can be used in conjuction with the vouchers – meaning I can get a meal for nothing! If you do go for these however, ensure you’re not eating beyond your means – while not as expensive as dining out, food delivery can easily get above £20, and considering cooking your own food with friends is usually around £1-4 in my experience (and more sociable!), eating in can be a much better option.

Cash Incentives

Some banks will offer you cash to sign up – for example, I remember Santander did a huge student prize draw, with a max prize of £100,000. Everyone who signed up, however, got at least £20.

Nationwide and Lloyds offered £100 for signing up, and NatWest offered £85.

What do I need to know about a student bank account?

Getting a student bank account has a few requirements, although you should be able to meet all of these quite easily if you’re a student.

You’ll need a UCAS code or confirmation letter with an unconditional offer, or a letter from a university confirming your place. UCAS have a guide on how to get your status code.

You’ll also be applying for credit with most of these student accounts (assuming you choose to apply for an overdraft while applying). This means you’ll need to pass a hard credit check.

You’ll also need ID and proof of address. This could be your driving license, passport, or any other valid identity document.

You can also only get an overdraft when you’re 18 – this shouldn’t be an issue for most students, but for those of you heading to Uni before you’re 18, you’ll have to wait until then to get an overdraft. I know from personal experience, a good few in my hall at Uni were under 18 on move in day.

Can I get multiple student bank accounts?

Generally, banks include in their terms that you may only hold one student bank account. From my personal experience, Nationwide was the only bank that explicity asked me if I had another student bank account on their form to apply for an account.

Remember, these safeguards exist to reduce the risk of students taking on more debt than they can realistically repay. For that reason, I wouldn’t recommend opening multiple student accounts -especially if your motivation is to access multiple overdrafts.

However, holding bank accounts with many banks can be very useful. For example, you can get access to bonuses – such as the Nationwide fairer share payment of £100, dependent on their financial performance.

Holding multiple accounts can also ensure you can access better rates – different banks will offer different financial products such as savings accounts, with differing terms. By having accounts with different banks, you’re more likely to find the account which would be best for you. As an example of a really good account available at the time of writing, Zopa are currently offering their Biscuit bank account, which comes with a regular 7.1% AER saver.

Thinking beyond first year

Many student bank accounts increase their overdraft limits gradually over your degree, and then convert into graduate accounts (which allows you to pay off your 0% overdraft). It’s worth checking:

• How the overdraft changes year by year
• How long the graduate overdraft will last
• Whether interest is charged after you graduate

A slightly worse sign-up bonus may be worth it if the long-term terms are more generous.

Why do I want a student overdraft?

I’ve seen greatly differing opinions on overdrafts at University. There are those who are more aggressive with their savings (such as me) and those who shy away from their overdraft like it’s going to burn them.

Personally, I like to do something called ‘stoozing’. You can read more about it on the MSE website, but the basic idea is if you’re being offered, let’s say a £1000 overdraft at 0%, you can then put that in a savings account at 5%, and get £50 after a year. That’s money for nothing! (and your chicks for free).

Of course, that isn’t without risk – if you go over your overdraft, you can easily ruin your credit score and incur heavy fees – which can wipe out that £50 far too easily. To avoid this, I don’t put any payments through my accounts with an overdraft, and have dedicated cards for my spending, which offer me rewards such as cashback and points. I won’t go into this now, but I may well write another post about these – let me know if you’d be interested in that in the comments below.

Even if you don’t want to use your overdraft to make some extra money, it can still provide value – let’s say your student accomodation payment is due before you get your next maintenance loan instalment, or your next paycheck. Used carefully, an overdraft can:

• Help cover essentials such as food if a loan payment or wages are delayed
• Reduce the need for short-term borrowing at high interest
• Provide flexibility

It is important, however, you don’t look at this overdraft like it’s extra income. That money isn’t yours – and the bank can ask for it back at anytime. Don’t go spending it unless you have a concrete plan for how you’re going to pay it back.

Risks with ‘stoozing’ – and having a backup emergency fund

That brings me onto another point – when ‘stoozing’ you also could place that money into stocks and shares. This does have the potential to offer you a slightly higher return, but at the risk of the value of the investment decreasing, and at the added cost of being more illiquid. If you do decide this is an avenue you’d want to pursue, ensure you still have enough cash reserves to be able to pay off the overdraft, and cover your living expenses for a decent while.

How long that period is will vary person to person, but imagine you suddenly have an unexpected bill – e.g. your car or bicycle breaks, and you have to pay £500 to get it fixed. Also assume that you lose your job, and you now need to rely on your savings. This is what makes instant access savings accounts beneficial – you’re placing your money away, so psychologically it’s seperated from your spending pot, and it’s also growing (hopefully at at least the rate of inflation), but it’s always there if you need it.

Final thoughts

I hope the above is useful when you come to choosing your which student bank account you want to go with, and that some of my anecdotes prove useful. With so many options, it’s easy to focus on sign-up bonuses or short-term perks, but the real value you’ll find from these accounts is often through how they support your through your degree – and potentially beyond when they mature into a graduate account.

It’s worth remember that there is no ‘best’ student bank account for everyone. The right choice is going to depend on ho you manage money, whether you expect to use an overdraft, and comfortable you are with borrowing – even at 0%. Taking time to understand the terms and your options now, could well save you stress further down the road.

If there’s one piece of advice you take from this post – be financially responsible. It’s easy to underestimate how badly you can be burned by making a simple mistake, or if your finances change due to something you can’t control (e.g. losing a job).

If you’re unsure, don’t rush the decision – weigh up your options. You can always ask a parent or someone else you trust, who have good financial habits, to help steer you in the right direction.

Disclaimer

Again – remember this isn’t financial advice. I’m not a financial adviser or any sort of finance professional. The information here is here for general information purposes, and is based on my personal experience and research. Do your own research and check the latest details before making any decisions.

Also, remember banks frequently change their offers and incentives, and those above are included for illustrative purposes only. Always check the terms directly with the provider before making a decision.