A bank account is essential today. If you work, you need a bank account for your wages to be paid into, and if you receive Universal Credit you will need one for the electronic payment. The coronavirus means retailers and banks have been pushing us to use contactless payments and online services for hygiene reasons.

Southway's Advice Team is here to help you set up a bank account and get you started with the basics of banking like using direct debits and standing orders.

Elaine, our Employment and Money Coordinator, talks through the steps below.

Choosing your account

Before applying you need to decide what type of account suits you best. Look at comparisons between a bank’s accounts on their website.

Basic accounts are usually free; you tend to receive a debit card that allows you to pay for goods and services in shops, over the phone and online. The card can also be used to withdraw money from ATMs and get cashback.

Current accounts are the same as basic accounts, but include a chequebook and an authorised overdraft facility, which will be charged for.

Savings accounts are good for saving money for things like holidays or Christmas. They usually earn some interest.

Banks call these accounts different names so make sure to check which of their accounts is which. Some also offer cash back benefits when using certain stores.

Opening your account

Most banks are no longer offering face to face appointments so opening a new account relies on submitting online applications via their website. 

Banks will still require two forms of ID, one to verify who you are (personal ID) and one to verify your address.

Personal ID: Preferably photo ID like a full driving license or passport (make sure it's in date). If you haven’t got either of these then a benefit eligibility letter is accepted. Use one that states the amount you are receiving and includes your National Insurance number.

Proof of address: This can be a recent utility bill (less than 3 months old), council tax or water bill (less than 1 year old) or tenancy agreement (original document or copy with Southway stamp).

It is important that your name is the same on both documents with the same spelling and including any middle names. If you have lived at your address for less than 3 years you will also have to provide any previous addresses.

After submitting the online application the bank will email you a reference number with instructions to take your ID to a branch in your area to be verified. You don't need an appointment to do this. Supplying the reference number will allow the bank staff to link your ID to the application you submitted on line.

You will be able to ask staff questions about the account and they can help with registering for telephone and on line banking.

You will also be asked to sign a form to say you have read, and agree to, their terms and conditions. You will then be sent a bank debit card and a separate letter with your PIN code after a few days.

Using your account

Once your account is set up you can have your benefits or wages paid in by giving your new account details to your employer or whoever issues your benefits or pension. Letters from the benefits or pensions service will have the number on to contact them.

When given options, you should select one that deals with ‘Change of circumstances’. Have your bank’s sort code and account number ready to give them.

Future payments will then go into your new account. It is also worth asking when payments will start going into your new account, so you can check the account.

Keeping safe

Remember to check your bank statements regularly, to make sure you have been charged correctly for goods and services and that all outgoing payments are yours. It is also good to check that money entering your account, such as your wages or refunds, are the right amount and received on time. 

If you have any other questions about money, see the Help with Money pages, or just contact us.