Banking in the UK: A Guide for New Arrivals 

Introduction

Moving to a new country comes with plenty of admin, and banking is often near the top of the list. Setting up a UK bank account helps you receive wages, pay rent, shop online, and manage your day-to-day spending. But if the system is unfamiliar, knowing where to begin can be tricky.

This guide explains how the UK banking system works, what types of accounts are available, the difference between banks and building societies, and how to open an account as a new arrival.

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1. Understanding the UK Banking System

The UK has a well-established banking system with a mix of traditional high street banks, building societies, and digital-only banks. It’s regulated by the Financial Conduct Authority (FCA) to ensure fairness, security, and transparency.

All UK banks and building societies are also covered by the Financial Services Compensation Scheme (FSCS), which protects your money up to £85,000 per person, per institution in case the provider fails.

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2. What’s the Difference Between a Bank and a Building Society?

While they offer similar services, the structure of banks and building societies is quite different:

Feature	Banks	Building Societies
Services offered	Full range – accounts, loans, credit	Mainly personal banking and mortgages
Customer focus	May prioritise shareholders	Often more customer- and community-focused
Ownership	Shareholders	Members (account holders)
Profit distribution	Profit goes to shareholders	Profits reinvested or returned to members

Example banks: HSBC, Barclays, NatWest
Example building societies: Nationwide, Yorkshire Building Society

Many building societies are known for better interest rates on savings and a more personal approach, though they may have fewer branches and products.

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3. Types of Bank Accounts in the UK

Depending on your needs and immigration status, here are the most common account types available:

• Current Account: Standard account for day-to-day use, includes a debit card, direct debits, and online access




• Basic Bank Account: A simpler version without an overdraft – easier to open if you have limited ID or credit history




• Savings Account: Helps you put money aside with interest – can be opened alongside a current account




• Student Account: For those studying in the UK – often comes with perks like railcards or interest-free overdrafts




• Digital-only Account: Banks like Monzo, Starling or Revolut operate fully online – fast setup, useful if you don’t have proof of address yet

4. What You Need to Open a UK Bank Account

To open a standard account, you’ll usually be asked for:

• Proof of identity: Passport or Biometric Residence Permit (BRP)




• Proof of UK address: Utility bill, tenancy agreement, or a letter from your employer/university




• National Insurance number: Sometimes requested, especially if you’re working

Tip: If you don’t have a permanent address yet, some digital banks allow verification through their apps using location services or scanned documents.

5. Choosing the Right Provider

Here are a few things to consider when picking a bank or building society:

• Ease of account setup – do they offer online signup or require an in-branch visit?




• Customer support – do they offer multilingual service or in-app chat?




• Fees and charges – some charge for overseas transfers or cash withdrawals




• Reputation and reviews – helpful to know how newcomers have been treated




• Digital tools – do you want strong budgeting features or a user-friendly app?

6. Can You Open a Bank Account Before You Arrive in the UK?

Most high street banks require you to be in the UK with an address before you open an account. However, digital banks like Monzo and Revolut may allow you to start the process using your phone and passport while you’re still abroad – a useful option for planning ahead.

7. Common Questions from New Arrivals

Can I open an account without a job?
Yes – you don’t need to be employed to open a bank account, but it may affect what type of account or credit options are available to you.

Do I need a UK address?
Usually yes, but some banks and apps offer alternatives like letters from a hostel, university, or employer.

Can I have more than one account?
Yes – many people open a digital account for everyday spending and a traditional one for salary or rent.

8. Hyfa Foundation Tip: Be Clear on Your Rights

If a bank or building society refuses to open an account, they should explain why. You’re entitled to access basic banking services, and there are alternatives if the first provider isn’t a good fit.

Conclusion

Opening a bank account is a vital part of settling into life in the UK. From traditional high street banks and community-focused building societies to fast, flexible app-based options, there’s a solution for every situation.

Knowing what to expect helps you take control of your finances early and avoid unnecessary delays.

Download the Hyfa Foundation Pocket Guide to Moving to the UK for more help with housing, healthcare, and employment.