Banking language in the UK
Banking terms vary all around the world and the UK is no different. Here are a selection of terms you should study to avoid confusion when talking to your new bank.
Balance: The current amount of money in your account.
Bank statement: A record of your account over a given period of time, usually a month. It lists all money deposited, withdrawn or taken out by standing order as well as any charges or fines the bank has given you. Carefully read all of your statement and keep them all together in a safe place. If there are any mistakes on your statement contact your branch immediately.
Cash card: A plastic card that allows you to take money from your account using a cash point. When you receive your card from your bank you will also be given a personal identification number (PIN) to use it. Your cash card, cheque guarantee card, and debit card are usually all combined in to a single card for convenience.
Cheque guarantee card: A plastic card that allows you to write cheques up to the limit printed on it. See cash card.
Credit card: A plastic card that acts like a bank account. You can pay for goods on it or withdraw cash from a cash point with it. You can transfer money to it and be in credit but most people use it as a type of loan or overdraft. Interest rates can be very high, especially after an initial trial period, and hidden fees can add up. Try not to get a credit card at all but if you do always pay off what you have spent and the charges on it every month. Do not spend anything with it if you will not be able to do this.
Current account: A common bank account that does not pay interest on savings but allows immediate withdrawl of your money and lets you write cheques.
Debit card: A plastic card that allows you to spend money directly from your account without withdrawing money or writing a cheque. See cash card.
To deposit: To put money into an account.
Deposit account: A savings account that earns you interest on your money but often requires you to give notice if you want to withdraw any money (often a month). You cannot write cheques with this account.
Direct debit and standing order: An automatic regular payment to a particular person or company. This is a good way to ensure your rent and bills are paid on time but make sure there is enough money in your account to do so or you will be fined.
Interest: Either money paid to you by the bank for the amount of money you have deposited or the fee charged to you by the bank for loans or an overdraft.
Overdraft/to overdraw: An overdraft is an agreed limit that you may spend of the bank’s money when yours is gone. It is best not to rely on this too much and only use it for emergencies as you have to pay interest on what you spend. To overdraw is to spend more money in your account than you have and without permission. You will be fined for this, sometimes for each £10 you spend over the limit.
PIN: Your PIN or personal identification number is a four-digit number that allows you to use your cash card and your debit card. Memorise it, do not write it down and do not tell anyone else what it is, even if someone contacts you claiming to be from the bank.
Student account: An account only for students that provides an interest-free overdraft. Banks will offer a lot of free gifts for you to open a student account with them. Choose one that is quite local and has the best services and interest rates. This will save you time and money in the long-term. However, some banks do not provide student accounts to international students so ask around.
To withdraw: To take money from your account with a cheque or cash card.
Still unsure of other words we’ve been using? Go to the Glossary.