Nationwide and Santander have been ranked the best student bank account providers for 2019, according to new research from Which?.
As thousands of students have received their A-Level results and are preparing to start university, they'll need to get in to the spin of how to deal with day-to-day adulting (and we all know what's it like when we have to pay our bills, etc). Wouldn't it be great if they could get into the habit of saving and managing their money with their student loans each month?
University can be expensive, food shopping, books, household bills and not to mention those nights out it's a lot to budget for! And as a nation of spenders instead of savers, having a great student account is key for being able to save – even if that's just saving to get though the next few months. And that's why the PayDay SaveDay campaign has been launched to encourage behaviour changes among those who don't save regularly, our younger population!
Banks and building societies will be trying to entice new customers with perks including cycling club memberships, Amazon Prime subscriptions and a range of travel and shopping discount cards, during student season.
But in a survey of more than 1,600 university students, our FlexStudent account – which shuns freebies and sign-up incentives in favour of a generous 0% interest overdraft and great customer service – came out on top. Go us! Topping the table with a customer score of 77% it received the best score for customer service across all providers, and students were impressed with its service, both in-branch, and through online and mobile banking.
Though we scored just two stars for sign-up incentives – providing no additional perks beyond 1% interest on balances up to £1,000 – it was praised for its generous interest-free overdraft, offering £1,000 in year one, £2,000 in year two and £3,000 in year three, and no unarranged overdraft fees.
Pia Welsby, Current Account Product Executive, said:
"It's great to see that our members continue to value and benefit from our transparent, fee-free proposition, ranking us first for customer service. FlexStudent has now won the Moneyfacts consumer award for student account provider of the year in 2018 and 2019."
"And we're supporting more members post-graduation with our fee-free FlexGraduate account and into their new working life."
Also ranked Which? best student bank account providers for 2019 was Santander's 123 Student account, with a customer score of 76%. It was praised for continuing to offer a four-year railcard worth around £90 and interest on credit balances, with the ability to earn up to £60 a year in interest.
Santander's overdraft facilities are less impressive though, with a lower interest-free overdraft limit in years two and three of university than Nationwide, and a hefty charge of £5 a day for use of an unarranged overdraft.
Two-thirds (65%) of first year students surveyed told Which? they had a student bank account, and one in five (21%) students (from all years) listed an overdraft on their bank account as a source of income on top of their student loan.
Gareth Shaw, Which? Head of Money, said:
"With so many students telling us that they rely on their overdraft for funding the cost of university, a student bank account with a generous interest-free overdraft can be a lifeline."
"There are a range of accounts tailored for students available on the market – with all kinds of perks used to entice new customers – so it's important to understand what's on offer before making your choice."
"Students should consider the conditions of the overdraft and the incentives on offer – and crucially, the terms for repaying the overdraft once the interest-free period ends."