A guide to high street and online banks for people with bad credit

Borrowing is an everyday part of modern life. However, if you have bad credit, it can be very difficult to borrow a loan because you are considered a high risk borrower. Luckily, there are bad credit banks (many online banks) that exist to help people with poor credit scores, serious defaults and even bankruptcy secure a loans.

Bad credit banks

If you are having trouble getting a standard bank loan because of poor credit, applying for a bad credit bank account online or offline is your best bet to securing effective banking services. Almost anyone with basic ID can open a bad credit bank account even with damaged credit rating.

Bad credit bank accounts, also known as 'basic bank accounts’, are specially designed for those with poor credit scores. As the name suggests, a basic bank account offers you just the basic features you would expect from a standard account.

The bank will allow you to store your money in the account and pay out of it, but you will not get in-credit interests or overdraft facilitates. Some online banks, however, may give you a debit card that you can use to conveniently make payments online.

What you need to open a basic bad credit account

To qualify for a basic bad credit account, you need to confirm who you are. In the UK, you will have to provide original copies of one or more of these documents:

- Full UK paper driving licence

- Identity card issued by the Electoral Office for Northern Ireland

- Current UK passport or Photocard driving licence

- HMRC Tax Notification or assessment letter, and

- Benefit entitlement letters, such as Child Benefit, Job Seeker's Allowance and pension.

    See-ming Lee 李思明 SML - flickr.com

Best basic bank account products

Mainstream bank staff will usually not mention the basic bank account products they have available unless you specifically ask for the account. This is because the accounts costs banks money and they want to keep them low profile.

However, despite the bureaucratically difficult associated with open the accounts, most high street and online banks will allow you to apply for a basic bank account if you have bad credit and you specifically ask for the account.

Among the best basic bank account products you can enquire in the UK are the Barclays Cash Card and the Co-op Cash Minder. Provide the required proof of address and ID and you will be able to apply for these and similar bank products for people with bad credit.

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