Can I open a current account if I'm unemployed?


Financial Guidance

Being unemployed can put a strain on your finances, especially if it wasn’t planned and you’re finding it tricky to get another job. You might even wonder whether you can still open a current account.

The simple answer, you’ll be pleased to know, is yes. You can open a current account while unemployed. But, you may be limited to which current account you can get.

In this blog, we've taken a closer look at the options available to you.

Why open a current account?

We may be a little biased, but having a current account is a super easy way to manage your money. Get your regular income paid in, like wages, benefits, or pensions, and set up regular outgoings, like bills or rent. A current account makes it simple for you to access and withdraw your money, keep it safe, and stay in control of your finances.

Are current accounts available for people who are unemployed?

Absolutely! You may not be getting a wage paid in, but you still need a bank account to get other forms of income, like benefits, and to pay your bills.

Here are a couple of accounts that you could open:

Basic bank account

Some accounts require a certain amount of regular income each month, so a basic bank account may be a good alternative for you. It won’t come with the perks other accounts may offer, like rewards, high-interest rates, or interest-free overdrafts.

But a basic bank account is a secure place for your money, allows incoming and outgoing payments, and will provide you with a debit card.

Budgeting account

If unemployment is causing you financial strain, it may be worth choosing a current account that can help you manage your money.

Here at thinkmoney, our Current Account comes with a Smart Budgeting tool to help you pay your bills on time. Open an account and tell us how much your monthly bills are. Then, Smart Budgeting automatically puts enough money aside whenever you get paid to make sure your bills are paid on time, every time.

You’re left knowing exactly how much disposable income you have left to spend. Plus, there are no hidden bank charges and no credit checks needed to open an account.

Which accounts can receive benefit payments?

If you have other sources of income, like benefits or universal credit, you’ll need to open a bank account. The types of accounts your benefits can be paid into are:

  • Current account

  • Basic account

  • Prepaid account

Top tip: not all prepaid accounts let you set up standing orders or Direct Debits.

Do I need a current account for jobseekers’ allowance?

If you’re claiming jobseekers’ allowance, you won’t just need a bank account for your benefits to be paid into. You’ll also need one for when you’re offered a new job so you can provide your account details as soon as you start. That way, your new employer can set you up on the payroll system straight away.

Can you get an overdraft when you are unemployed?

It’s unlikely that you’ll be able to open an overdraft if you’re unemployed. Although there are no restrictions in place stopping people who are unemployed from getting an overdraft, it’s uncommon for banking providers to give overdrafts to people who don’t have an income.

Can you have multiple bank accounts?

Yep. Despite what some people think, you can have more than one bank account at once. So, you can open a new current account even if you're unemployed. Having multiple bank accounts shouldn’t affect your credit score unless you open up too many in a short space of time. Some people will have more than one account for the below reasons:

  • To try out a new one before switching over completely

  • To take advantage of offers from the banking provider

  • To open a joint account if your existing banking provider doesn’t offer them

Want more tips on how to get more from your finances? Take a look at our banking guides for advice on how to budget your money and so much more.

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