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What is a Student Bank Account?

Essentially a student account is very similar to a regular bank account but with some extra bonuses and freebies designed to help you (or lure you) with a few things regarding student life.

Most student accounts will give you an interest free overdraft, which increases incrementally, over the period of your course, usually maxing out at about £2,000.

Other accounts may offer you free phone insurance, a free student rail card or better rates on credit cards etc.

The reason the banks offer student accounts is they expect graduates to earn more money on average than people who haven’t been to university and therefore they try and hook them in to a relationship early on.

Banks also know that students, more often than not, end up leaving university having maxed out their overdraft, allowing the banks to then start charging interest and making a tidy profit and also making it more difficult for graduates to change banks.

The banks are basically playing the gamble that most people don’t change bank accounts once they have start using one properly.