Fee-free, basic bank accounts were launched back in January 2016. Basic bank accounts are for people who do not have a bank account, are ineligible for a standard current account or who can’t use their existing account due to financial difficulty. These
accounts are primarily of interest to those with poor credit ratings who may be unable to pass the credit checks for standard bank accounts.

Basic bank accounts were available prior to 1 January 2016 however the new accounts meet enhanced standards agreed by the government and industry in late 2014. Newly published figures have revealed that over 900,000 new fee-free basic bank accounts were
opened between July 2016 – June 2017. This takes the total number of fee-free accounts open to nearly 5 million.

The basic bank accounts do not offer overdrafts or cheque books but are similar to existing bank accounts in many ways and are suitable for day-to-day transactions. The accounts also provide for counter access on the same terms as other bank customers and
also allow for access to ATMs and online services.

Economic Secretary, Stephen Barclay said:

‘The government has legislated to make sure fee-free basic bank accounts are available to those who need them and I am pleased to see that so many people – who might have previously been at risk of running up debt through bank charges – have access to
a completely free account.’

Source: New feed