Which student bank account offers the best perks in 2023?
Railcards, Tastecards and £100 cash are just some of the perks being offered to students this year if they open up a new current account.
Student bank accounts also tend to offer interest-free overdrafts which can be handy during your first term at university.
Here, we take a closer at the range of incentives on offer and what to watch out for in the small print.
What do student bank accounts offer?
We’ve rounded up the current perks available on student bank accounts. The table is arranged by Which? customer score.
| Student bank account | Which? customer score | Interest-free overdraft limit | Perk | The total value of the perk/s |
|---|---|---|---|---|
| Nationwide Building Society FlexStudent | 79% | Year 1: up to £1,000 Year 2: up to £2,000 Year 3+: up to £3,000 | £100 | £100 |
| Bank of Scotland Student Account | 76% | Year 1: up to £1,500 (0-6 months £500, 7-9 months £1,000 and 10 months+ £1,500) Year 2 to 3: up to £1,500 Year 4 to 6: up to £2,000 | £100 | £100 |
| Halifax Student | 75% | Year 1+: up to £1,500 | £100 | £100 |
| Lloyds Bank Student | 74% | Year 1: up to £1,500(0-6 months £500, 7-9 months £1,000 and 10 months+ £1,500) Year 2 to 3: up to £1,500 Year 4 to 6: up to £2,000 | £100 | £100 |
| Santander 123 Student Current Account | 73% | Year 1 to 3: up to £1,500 Year 4: up to £1,800 Year 5: up to £2,000 | Four-year 16-25 railcard | £100* |
| NatWest Student | 72% | Year 1: up to £2,000 (1-4 months £500, 5 months+ £2,000) Year 2: up to £2,000 Year 3: up to £3,250 | -£100 -A four-year Tastecard (worth £34.99 a year) | £239.96 |
| Royal Bank of Scotland Student | 72% | Year 1: up to £2,000 (1-4 months £500, 5 months+ £2,000) Year 2: up to £2,000 Year 3: up to £3,250 | -£100 -A four-year Tastecard (worth £34.99 a year) | £239.96 |
Table notes: The customer score is taken from our survey of the Best and worst banks, you can use this guide to see how each provider scores in several categories including customer service and mobile banking. * Three-year railcard cost £70, and one-year railcard costs £30.
Which account offers the best interest-free overdraft?
All the student accounts we looked at offer an interest-free overdraft, but the limits varied depending on the provider and the duration of the course.
Nationwide, NatWest, RBS and HSBC are willing to offer the most generous limits by the third year of your course.
Just remember you may not be offered the maximum overdraft limit, as most banks will assess your eligibility on an individual basis based on your credit score.
Also while a student overdraft is interest-free for the duration of your course, the loan will start to attract interest, usually two years after you graduate. So you'll need a plan on how to pay it back, ideally before the interest kicks in.
- Find out more: best bank accounts for overdrafts
Should you get a student credit card?
An interest-free overdraft will be better than borrowing money using a student credit card. This is because you won't have to pay any fees - provided you stay within your limit.
However, a student credit card could be a good way to build up your credit score while at university or college. But you’ll need to pay it back off every month in full. You’ll also benefit from Section 75, which means you get more protection on purchases over £100, up to £30,000.
Credit card options for students have dwindled in recent years. In 2020 there were seven available and now just three remain on the market, according to Moneyfacts data. Out of the providers in our table, only TSB and HSBC offer credit cards designed for students.
- Find out more: best credit card deals August 2023
What are the best student bank account offers?
NatWest and RBS offer the most valuable perks according to our analysis. They both offer a £100 incentive for signing up plus a four-year Tastecard membership (worth £34.99 a year) which works out as a saving of £139.60.
Tastecard membership offers 2-for-1 deals at participating restaurants, up to 50% off pizza delivery, and money off at the cinema. However, if you don't go for either of these accounts you can still get a 60-day free Tasecard trial or save by getting a Totum card (£24.99 for a three-year membership), which offers discounts on shopping and comes with a free Tastecard.
Most providers are offering £100 cash this year including Natwest, Bank of Scotland, Halifax, Royal Bank of Scotland, Nationwide, Lloyds and HSBC. This perk offers the most flexibility and could be used to help you make even more savings. For example, you could use it to purchase a three-year railcard or a Tastecard.
Santander and Barclays offer perks that amount to a similar value as the £100 cash incentive other providers are offering.
Santander is offering a 16-25 Railcard for four years. The card usually costs £30 for a year, or £70 for three years, and can save you a third on rail travel. However, if you don't like the sound of the account you could save on getting a railcard by using your Tesco Clubcard points.
Barclays is offering 12-month access to Perlego, a digital online library that offers academic textbooks, and non-fiction e-books. It could save you £96 a year compared to getting the subscription yourself and might come in handy when the books you need for your course are checked out of your local or university library.
- Find out more: how to find cheap train tickets
What to watch out for when choosing an account
Most banks require you to spend or deposit a certain amount to be eligible for the perks and overdraft on offer.
Lloyds Bank, Halifax and Bank of Scotland require you to deposit at least £500 by 31 October to receive the £100 into your account by the end of November.
Nationwide requires you to pay in at least £500 by 15 December and your £100 will be paid within 14 days.
HSBC requires you to use your debit card five days within 30 days of opening the account, and you’ll be paid the £100 within 30 days.
NatWest and Royal Bank of Scotland only require you to open the account and the £100 will be paid within 10 working days.
- Find out more: best and worst banks
