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Banking How do I choose a bank? To find the ideal bank is a very personal choice, normally based on criteria like: ATM network, customer service, international services capabilities, fees for account management and international transactions, interest rates on savings and overdrafts, online banking capabilities, branches in your immediate neighbourhood etc. Most of the banks do not charge fees for standard account maintenance; only Barclays and Lloyds charge £5/month. Interest rates on savings range from nothing at some of the big banks to 4% or more at some "alternative" banks. Authorised overdraft rates range from 10% to 19% annually. All banks offer online banking. What are the major banks in London? There are four to six banks with very large branch networks in London and good experience with international customers: NatWest (owned by Royal Bank of Scotland) Halifax (owned by Bank of Scotland) And then there are Internet-based banks. They don't have their own branch networks (and therefore operate cheaper and are able to offer better terms), but collaborate with other banks for use of their ATM networks. Cahoot (a division of Abbey National) Egg (a division of Prudential Banking) first direct (member of the HSBC Group) Intelligent Finance (IF) (part of the Halifax Group) Nationwide (part of the Nationwide Building Society) Smile (part of the Co-operative Bank) If you are moving to London from the U.S., then one of the following banks might offer you advantages: What do I need to open a bank account? The UK has fairly tough rules when it comes to opening a bank account. To avoid fraud any bank is required to ask for many documents that prove your credit history, previous and new residence as well as your levels of salary and rent. Don't be surprised if your new bank asks you to show them ALL of these documents:
How long does it take to open a bank account? It can take up to two weeks to get a new account. It may take another week to get online access to it. This all depends on how quickly you can provide all of the required documents and on the efficiency of the bank. Again, having your employer call your bank may speed up the process. How can I cash my first cheques? You absolutely need a bank account to cash any kind of cheque. So, if your employer has given you your first cheque (salary, reimbursements etc.) you won't be able to cash it unless your account is open. Alternatively, ask your employer to make a direct transfer e.g. to your new landlord. How does the UK money transfer system work? The most common ways of making payments in the UK are: paying with your debit card or credit card, writing cheques from your current account, allowing direct debit, setting up standing orders. Account-to-account transfers via online banking are increasingly the norm. How do debit cards work in the UK? Debit cards in the UK are best known as "Maestro", or "Switch" cards. They are the equivalent e.g. of "Check cards" in the U.S., the "EC-Karte" in Germany and the "Carte Bleue" in France. In the UK, you pay with your Maestro/Switch card and PIN (or signature) and the money is taken out of your account immediately (as opposed to payments by credit card, which may take a month to be taken out of your account). What is the "current account"? For your everyday transactions you will need a "current account". This is the equivalent to the "checking account" in the U.S., "Compte Courant" in France and "Girokonto" in Germany. For your savings you may want to open an additional "savings account". What is the "sort code"? Every branch of every bank has a "sort code", which always looks something like this: 12-34-56. The equivalent in the U.S. would be the "routing number", in France: "numéro d'agence/code bancaire" and in Germany: "Bankleitzahl". What is "direct debit"? Setting up "direct debit", i.e. the automatic transfer of your variable utility bills without writing checks, is a very common practice in the UK. Some utility companies actually offer you discounts if you accept this form of bill payment. Some service suppliers are starting to offer electronic bill presentment and payment (e-billing), but it is not very common. The equivalent of "direct debit" in France is "prélèvement automatique", in Germany it is "Einzugsermächtigung/Abbuchungsauftrag". What is a "standing order"? To arrange the repetitive transfer of a constant amount, e.g. your rent, you may want to issue a "standing order". U.S. "automatic/scheduled bill payment", France: "virement automatique", Germany: "Dauerauftrag". |
Living in London Banking |
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