Best student bank accounts for overdraft offersLatest student bank account deals compared
17 September 2014
As new students prepare to start their first university term, Which? Money has rounded up some of the biggest interest-free overdraft offers out there - along with smallprint pitfalls to watch out for.
If your outgoings are likely to exceed your income when you're at university, then an interest-free overdraft should be your top priority when choosing your student account - over and above a free railcard or other enticing freebie.
But don't ignore the smallprint when you're comparing accounts - some of the interest-free overdraft offers aren't always so attractive on closer look.
For more advice on managing your money while you're at university, head to the Which? University website.
Biggest interest-free overdrafts
Halifax and HSBC offer the most generous headline overdrafts, with up to £3,000 available interest-free to students in their first year.
Barclays, Natwest and The Royal Bank of Scotland price-match their offers, with up to £2,000 of fee-free cash up for grabs.
A lower value overdraft is advertised by Ulster Bank (NI) at £1,000, while The Co-Operative Bank offers £1,400 for first-years.
We've compared 13 student bank accounts to help you weigh up what's available.
Check the overdraft smallprint
If you think you'll need an interest-free overdraft, make sure you're aware of any limits or restrictions to this facility. Barclays entices new students with a £2,000 overdraft facility, for instance, but only £200 of this is actually available in the first term.
Similarly with Natwest and RBS, you'll only get your hands on £500 of your overdraft in your fresher's term.
Halifax advertises a £3,000 overdraft limit, but you're only guaranteed £1,000 of this during your time at university – anything more will be subject to application and approval.
Don't be sold on freebies
Banks usually try to tempt new students to take out an account with them with a whole host of perks. This year's offering includes a four-year railcard from Santander and a £60 Amazon voucher from HSBC.
It's worth seeing what's out there, particularly if the freebie is something you'll actually use – but you need to weigh up the value of the giveaway against the interest-free overdraft on offer if you think you're going to be using it.