Last updated: 13/11/2023 | Estimated Reading Time: 3 minutes
Current accounts for people with bad credit
If you’ve got a bad credit rating, then you might find it hard to get a decent bank account.
Find out what options you have, and how to improve them, by reading this quick guide to banking with a bad credit score.
In This Guide:
- Credit ratings
- What are my current account options if I have a bad credit score?
- Will I have to pay for a bad credit bank account?
- What other options do I have?
Credit ratings
Your credit rating is important to your financial life as it will determine how easy it will be for you to take out any kind of loans or credit cards in the future. It will also determine the kind of interest rates you can expect when you do use any kind of credit.
Your credit rating will be determined by various factors to do with how well you've used credit in the past or how promptly you’ve paid any bills.
Any missed or late payments will negatively affect it, and any consistent and responsible use of credit will improve it.
What are my current account options if I have a bad credit score?
If your credit rating is either bad or limited, then you'll have trouble accessing the best current accounts on the market.
Thankfully, there is a type of current account known as a basic bank account that is specifically designed for people who find themselves in this position.
Basic bank accounts will let you use basic current account features like depositing and withdrawing cash and using a debit card. They will, however, be limited in their other features - you won't generally be able to go overdrawn for example, nor will you be issued with a cheque book.
You may find that if your credit rating is particularly bad, you might not even be accepted for a basic bank account, so you should ask your bank first before you apply. This is because having your application rejected will make your credit score even worse.
If you shop around enough you should be able to find an account that will suit your needs. Head over to our current account comparison page to have a look at the various accounts on offer today.
Will I have to pay for a bad credit bank account?
If your credit rating is either bad or limited, then you'll have trouble accessing the best current accounts on the market.
Thankfully, there is a type of current account known as a basic bank account that is specifically designed for people who find themselves in this position.
Basic bank accounts will let you use basic current account features like depositing and withdrawing cash and using a debit card. They will, however, be limited in their other features - you won't generally be able to go overdrawn for example, nor will you be issued with a cheque book.
You may find that if your credit rating is particularly bad, you might not even be accepted for a basic bank account, so you should ask your bank first before you apply. This is because having your application rejected will make your credit score even worse.
If you shop around enough you should be able to find an account that will suit your needs. Head over to our current account comparison page to have a look at the various accounts on offer today.
What other options do I have?
One option you have if you want to improve your credit score and therefore improve your ability to get a better bank account or loan in the future is to take out a credit building credit card.
These cards are much like conventional credit cards but with a low limit and a high APR to ensure that you spend minimally and pay off the balance promptly.
Using one of these cards well over time will serve to improve your credit rating steadily.
