How to manage your bank account

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Here is how to use your current account to keep it running smoothly and avoid being charged fees.

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This guide explains all you need to know about managing your current account, from checking the balance and using online banking to withdrawing cash and making payments. 

How to check your account balance

Keeping track of your account balance is important as it can help you avoid interest charges for going into your overdraft, budget for the rest of the month and look out for fraudulent transactions.

You can check your balance by:

  • Signing in to internet or mobile banking

  • Setting up text alerts to keep you informed of your balance

  • Checking your statement, which you can get by post or online

  • Asking in a branch

  • Phoning your bank

  • Checking it at a cash machine

Here is how to use internet banking, mobile banking and text alerts

How to use internet and mobile banking

Nowadays, most banks let you manage your account using their website or mobile app. The big advantage of this is you can bank on the go and access your account almost anywhere. You’ll be able to:

  • Make a one-off payment to a person or company

  • Check your balance

  • Move money between your own accounts

  • Set up, change or cancel direct debits and standing orders[

  • Report a missing card

  • Send a secure message to your bank

Here is everything you need to know about using online banking

How to make payments and spend money

You can spend, transfer or withdraw the money in your account in the following ways:

Set up direct debits and standing orders

Direct debits and standing orders are regular payments. For example, they might go out on the first day of every month or every three months. 

You can use direct debits and standing orders to make payments to:

  • A company

  • Another current or savings account in your name

  • Another person's account

Direct debits tend to be used to pay companies, usually for bills, while standing orders send money to other accounts. Here is more on how to set them up and how they work.

Make sure there is enough money in your account to pay your standing orders and direct debits because you may be charged a fee if not.

Send a bank transfer to someone

You can pay another person or a company by making a one-off bank transfer.

Funds are usually sent as a faster payment, a type of bank transfer that generally takes less than two hours to arrive.

The easiest way to do this is usually by using internet or mobile banking, but you could also set it up:

  • By phone

  • By writing to your bank

  • In a branch

You need to provide your bank with:

  • The amount you want to send

  • The name of the company or person you wish to pay

  • Their six-digit sort code

  • Their account number, which is usually eight digits

  • The reference that goes with your payment

If you pay a company, they usually tell you what to use as the reference. If you pay a person, use your name or something else recognisable as the reference so they know why they have received the payment.

You could also use a service called Paym to send money from your mobile phone to another person's bank account. Here is how to do this.

Transfer money between your accounts

If you want to send money to a current or savings account you hold with another bank or building society, the process is the same as transferring money to someone else.

However, if you have a savings account with the same bank, you may be able to move funds between your accounts instantly. You could use internet or mobile banking, phone your bank or visit a branch.

Use your card

Most banks offer a debit card you can use to make purchases in the following ways:

  • In-person in a shop, restaurant or other business

  • When shopping online

  • By phone

  • Using mail order

If you shop online, by phone or by mail order, you need to provide the 16-digit number and the expiry date on the front of your card.

You may also need the issue date and issue number from the front of the card, and the CVV, which is a three-digit number on the signature strip on the back of the card. (American Express cards have a four-digit CVV number on the front of the card.)

If you pay in person, you can put your debit card into the card reader and then enter your PIN to confirm the transaction.

Many banks also offer contactless and mobile phone payments to make smaller transactions quicker. The limit for contactless payments has steadily increased and is now £100. Some banks will let you reduce this limit if you prefer, or you may be able to opt-out completely.

Here is how to use your debit card safely to keep your money and bank account secure.

What if you have a prepaid card?

What if you have a prepaid card?

Some accounts come with a prepaid card instead of a debit card. These can be a good option if you have a poor credit score as no credit check is carried out. Here is how prepaid bank accounts work.

How are debit card purchases protected?

When you spend on your debit card, you get some protection from the Chargeback scheme, which could give you a refund if things go wrong. Here is how the Chargeback scheme works.

Withdraw cash

You can use the debit card, prepaid card or cash card that comes with your account to take out cash from an ATM.

  • Insert your card into the cash machine

  • Enter your PIN

  • Check your balance if required

  • Choose how much cash you need

  • Remove your card and the money from the machine

Most banks send your PIN by post when they issue your card. If you do not know your PIN, ask them to send you a new one. You can change it at any time at a cash machine or through internet banking.

Here is how to use your card safely at an ATM

Write a cheque

You can still pay bills using cheques if you have a chequebook, although many shops no longer accept this form of payment.

Here is how to write a cheque

How to use your overdraft

If your bank account has an overdraft, you can borrow money when your account has nothing left in it. However, it’s important to pay it back as soon as you can.

Overdrafts let you borrow for free if you have one that charges no interest and you stay within your overdraft limit. However, many banks charge interest, and rates can be high.

Note that under new rules introduced in April 2020, banks can no longer charge daily or monthly fees for using an overdraft. Instead, you can only be charged a single overdraft interest rate. The same rate must apply to both arranged and unarranged overdrafts – rates can no longer be higher for unauthorised overdrafts. 

Here is everything you need to know about overdrafts

How to pay money into your account

Pay in cash

You can pay in cash at your nearest bank branch using the counter, self-service machine or an ATM that accepts cash deposits.

Your bank may need you to fill in your details and the amount you are paying on a remittance slip form before you hand over your cash. You need to put it in one of the bank’s envelopes if you pay it in using a machine.

The bank should credit the amount to your account immediately. Some banks also let you pay in cash at a Post Office if you do not have a branch nearby.

Pay in a cheque

You can pay in a cheque by:

  • Taking it into your local branch

  • Posting it to your bank

  • Using special cash machines that offer self-service banking

Discover how to pay in a cheque and how long it takes for the money to arrive in your account

Receive payments by bank transfer

A company or another person can send money to your bank account. You just need to let them know:

  • The name on your account

  • Your six-digit sort code

  • Your account number

These details should all be on your statements and when you sign in to online banking.

You can also receive money into your account by just giving the other person your mobile number if they use a service called Paym. Here is how Paym works.

How to update your details

You need to let your bank know if your details change, including your:

  • Name

  • Address

  • Phone number or email

  • Marital status

Some banks let you update these through internet banking or by phone. Some need you to complete forms or provide identification or a marriage certificate, which can be easiest to sort out in a branch or by post.

Ask your bank what they need from you to update their records.

How to close your account

You can close your bank account at any time, but you need to pay off your overdraft first if you owe money on it. You can ask your bank to close your account:

  • In a branch

  • Online through internet banking

  • By phone

  • By writing to them

If you already have another bank account, you can have your wages paid into it and move your direct debits and standing orders over.

Switch to a new account

If you want to close your bank account and get one with a new bank or building society, you can switch in seven working days as long as your bank uses the Current Account Switch Service.

The bank will move your account balance or overdraft to the new account along with future salary payments and any direct debits or standing orders. If anything goes wrong during the transfer, your new bank will refund any charges. 

Here is how to switch to a new bank account

New bank accounts are offered all the time, so compare all of the best options to make sure you get the right one for you.

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