Moving to a new country can be quite an overwhelming experience, even if you have been planning it for a while. Upon arrival, you will need to immediately handle dozens of things that will define the quality of your life in the foreseeable future: rent an apartment, deal with taxes, and purchase health insurance. Although most of these issues will probably be resolved in the first few months after emigration, there is one matter that you will have to think about the whole time you stay abroad: successful management of your personal finances.
Making sound financial decisions is especially important if you are moving to a country such as the United Kingdom, which consistently ranks among the places with the highest cost of living. To facilitate this process for you, Profee has compiled a guideline which answers basic questions about UK bank accounts. Our instructions are aimed primarily at Indian citizens who make up the majority of the UK expat community; however, we believe that anyone who considers the United Kingdom as a long-term destination will learn something new and useful from this article.
Is it possible to live in the UK without a local bank account?
Of course, Indians living in the UK are not obliged to open an account in one of the local banks. There are at least two alternatives: pay with cash everywhere or continue to keep money in an Indian bank. Though both these methods have their advantages, there are also significant drawbacks that need to be considered.
The use of cash in the United Kingdom, especially in the capital, is gradually declining. The country has been turning towards a cashless society for quite a while already, with the COVID-19 pandemic serving as an unexpected argument in favour of this approach. Banking body UK Finance predicts that by 2031, only 6% of all payments in the country will involve cash. Thus, if you do not want to unexpectedly find yourself in a situation where you cannot pay in a store or museum, it is better to have an active bank account.
If, before moving, you had an account in an Indian bank and an international card linked to it, you can continue using it in the UK. Nevertheless, it is highly likely that transactions that you make will be affected by unfavourable INR-GBP exchange rates and subjected to additional fees. For example, SBI (State Bank of India) charges 3 to 3.5% of transaction amount plus applicable taxes for international operations. Other major Indian banks, such as HDFC Bank and ICICI Bank, apply similar conditions. Of course, you may still keep your Indian bank account for savings, but it is hardly the cheapest option to pay for goods and services in the UK.
As you can see, opening a new bank account in the UK is a logical step that allows to avoid unnecessary money losses and stress associated with the inability to pay for certain things in cash. Having a UK bank account will also simplify the process of sending money from the UK to India. This conclusion, however, entails many concerns: how to open a bank account in the UK? Is the procedure complicated? Can it be done online?
In the following chapters of this guide, we will address each of these questions and help you plan your course of action.
What banks open accounts to Indians in the UK?
Speaking about the British banking system, it is impossible not to mention the names of several banks that are especially popular in the UK: HSBC, Lloyds Bank, NatWest, Barclays, and Royal Bank of Scotland. The excellent reputation of these institutions allows you not to worry about the safety of your money. Moreover, well-known banks typically have a wide network of branches and ATMs and advanced online banking tools, making it simpler to access your funds and conduct transactions.
If you wish to open a bank account at one of the top-tier UK banks, we must warn you in advance that it is not the easiest procedure for non-residents or those who have only recently moved to the UK. Most of these establishments demand the customer to be at least 18 years old and to go through two verification steps: submission of proof of identity and proof of address.
The minimum age requirement and identity check will hardly be a major obstacle. If you have decided to move from the UK to India by yourself and are wondering how to open a bank account in the UK for personal use, you are certainly over 18 years old and have a valid passport with a UK visa. Suppose a passport cannot be provided for some reason. In that case, banks also accept other kinds of documents as proof of identity, for example, a UK photocard driving license or a current national identity card issued in EEA (European Economic Area).
The main stumbling block to opening a UK bank account for non-residents and recent expats is the requirement to submit a proof of address. The list of accepted documents may vary from bank to bank, but generally, they ask you to provide one of the following papers:
Utility bill,
Council tax bill,
HMRC (HM Revenue and Customs) tax notification,
Mortgage statement,
UK bank or credit card statement
In some cases, banks will also consider alternative papers, such as a tenancy agreement or a letter from your employer confirming your address and that you currently work for them. For example, if you try to open a bank account online, HSBC UK will show you a relatively short list of acceptable documents, but you will have a lot more options if you visit a branch. Major banks also encourage potential clients to contact them directly to discuss possible solutions if none of the listed variants suits you.
Often, potential bank clients try to provide documents from their home countries as proof of address. Unfortunately, a utility bill or a mortgage statement with an Indian address will not be considered sufficient for opening a UK bank account. The paper that you submit must contain your full name and your residence address in the United Kingdom. It should also be relevant: for example, if your utility bill or bank statement are older than 3 months, they will not be accepted.
If you are still an Indian resident and don't have any UK address, let alone proof of one, but want to become a UK bank client regardless, you may consider turning to one of the establishments that offer the service of opening a special UK bank account for non-residents. These options are usually easy to find using keywords such as "international / expat account" or 'global money'. However, you should be prepared for special requirements associated with these services. For example, Barclays Bank allows one to join their international banking system under the condition that you maintain at least 100 000 GBP or its currency equivalent with them.
As you can see, high-street UK banks have their pros and cons. On the one hand, they offer their clients security and service convenience; on the other hand, their entry requirements might scare off the customers who are looking for the easiest way to open a UK bank account, especially non-residents and recent immigrants. Luckily, with modern financial technologies, clients are not limited to traditional banks and may consider other methods of keeping and spending money.
Are there any organizations that can open a UK bank account without proof of address?
If the opportunity to communicate with a bank representative in person is not important to you, you can open a bank account online in one of the digital banks that are quite popular in the UK. These organizations take the same responsible approach to security and quality service as physical banks, but usually establish more favorable registration conditions for new clients. For example, Starling Bank clearly states that they welcome all potential customers who are above 16 years of age and live at a UK address. Although this still cuts off a certain segment of clients – in particular, those who have not yet moved and are looking for how to open a UK bank account for non-residents – it is an excellent opportunity for newly relocated individuals who already have a residence address in the United Kingdom, but are not yet receiving utility bills or tax notifications.
Apart from Starling Bank, there are a few other names of digital banks and fintech companies that operate in the UK and that you might select for your purposes, such as Monese, Monzo and Revolut. All these establishments have adopted a simplified registration procedure which allows one to open a bank account online without much hassle, given that the customer already has a UK address. You must bear in mind, though, that even if you only submitted proof of identity at the onboarding stage, this does not mean that you will never be asked to provide proof of residency in the United Kingdom. Verifying customer addresses is a standard requirement of financial regulators who control the activities of both traditional and digital banks.
I have managed to open a UK bank account. What is next?
If you have successfully overcome all the difficulties associated with opening a new bank account in the UK, make sure to profit from all the opportunities that come with it. You don't have to limit yourself to just storing funds and occasionally purchasing goods and services: depending on the conditions of your bank, you may also use your account to pay household bills, receive salary or make savings.
Opening a UK bank account is also an excellent move if you wish to financially support your family and friends back in India. Though making international wire transfers directly from your bank might come at a high price, you can explore alternative options such as Profee – an international money transfer service that helps people who have an open bank account in the UK to send funds online to India and 60 other countries on favourable terms.
