Money and banking in the UK
Money
Different ways of Banking:
The Banking system here is different to many countries. Almost 63% of the payments made in the UK are contactless, which eliminates the need to carry cash around. It is still recommended to carry a small amount of money on you incase you need to pay for parking, toll bridges or other services that require cash only payments.
If you have the need to deposit cash into your bank account, you can either do it over the counter at the bank or at the cash deposit machines inside/outside the bank. You need your debit card for both ways of depositing cash as you will be asked to insert your card into the card reader and enter your PIN to authenticate your account.
The Post Office is also another place where you can deposit money into your account. It works the same way as a bank where you take your card with you every time you deposit money into the account. The advantage with post office is that you can deposit money in any bank account from just one place rather than going to each bank separately.
There are different ways to Bank in the UK:
- Debit card: A debit card allows a user to directly access any funds in their bank account by connecting it to their card. A consumer will only be able to use their debit card to make payments or use a cash machine to take out cash if they have enough money in their account.
- There are three main types of debit card:
- Credit card: While credit cards and debit cards can be used in the same ways, the main distinction is that consumers are making purchases with funds they will eventually need to repay. When a person obtains a credit card, they consent to repay the balance, sometimes with interest, and are assigned a credit limit, which is the maximum amount they are permitted to spend.
- There are three main types of Credit Card:
- Visa
- Mastercard
- American Express
- Prepaid card: There's also the option of using prepaid cards instead of cash. While the cardholder does not need to have a linked bank account, they are comparable to debit and credit cards in that they can be used for contactless, chip and PIN, and online and in-store payments. Rather, money is pre-loaded into the card and can be added to as needed.
In essence, they give the owner the flexibility of alternative credit options without putting them at danger of accruing debt. There can be additional costs for the consumer, though. Some of the famous Prepaid cards are Revolut, Monzo, Thinkmoney, Cashplus and Serve American Express.
- Contactless: Most plastic cards that are issued these days may be used to make contactless payments, which eliminates the need for the cardholder to input their own PIN while making a purchase. Customers can just tap and go from card machines that use contactless technology, which reads card payment information from a short distance. Contactless payments are becoming more popular due to their quickness and simplicity. Indeed, contactless is currently the most widely used payment option in the UK, with nearly half of shoppers (48%) choosing it. You can also do this on some smart phones.
- Buy Now, Pay Later: Customers can use the Buy Now, Pay Later (BNPL) payment option to spread the cost of their purchases over a predetermined period of time rather than having to pay for them all at once. BNPL services typically collaborate with retailers to give clients the option to pay for their goods in instalments, frequently at no interest or with very little interest. Some of the popular BNPL apps are Klarna, PayPal, Payl8r, Laybuy and Curveflex.
Banking
Most employers pay through UK bank transfer monthly so you will need a bank in the UK.
Traditional banking
Having bank account and bank cards will allow you to make online payments, use contactless and access your bank account in branch or online.
There are a number of banks in the City that you can choose from below:
-
Barclays Bank | Website: Personal banking | Barclays
-
67B Above Bar St, Southampton SO14 7DZ
-
425-427 Shirley Road, Southampton, SO15 3TH
-
106 Burgess Road, Southampton, SO17 1TW
-
Metro Bank | Website: Metro Bank | People-People Banking (metrobankonline.co.uk)
-
Halifax | Website: Halifax | Mortgages, Bank Accounts, Savings, Loans & Investments
-
Lloyds Bank | Website: Lloyds Bank - Personal Banking, Personal Finances & Bank Accounts
-
NatWest | Website: NatWest Online – Bank Accounts, Mortgages, Loans and Savings
-
Royal Bank of Scotland | Website: Royal Bank of Scotland Online – Bank Accounts, Mortgages, Loans and Savings (rbs.co.uk)
-
Trustee Savings Bank (TSB) | Website: Personal Banking | Life Made More | TSB Bank
Opening a bank account
You will need to present documentation to the bank you would like to bank with to open an account, which are:
-
Proof of ID:?This could be your passport, UK drivers licence, National ID card, or Biometric Residence Permit (BRP) card. The ID document usually needs to contain your photo, and most banks will also want to see your BRP card (if you have one) as proof of your immigration permission in the UK. If you're booking an appointment with the bank, it is a good idea to allow yourself enough time to collect your BRP card once you have arrived in the UK, so you can attend your appointment with your BRP card.
-
Proof of (UK) address: Many banks will ask for proof of a UK address in order to open a UK bank account, eg, a recent utility bill, bank statement, UK driver's licence (if this was not already used as your proof of identity).
-
Student status letter:?A bank letter from the university following enrolment on your course. You can request a letter after enrolling online.
Digital banking
Digital banking gives businesses the ability to manage money through their phone, with apps that have real-time updates on spending, plus features for budgeting and saving. You may be able to arrange a digital banking solution from abroad.
Examples are listed below, but there are many options available. Please be aware that some of these may not be available if you live outside the EU or EEA.