Finance
How to open a current account with bad credit
Published by linker 5
Posted on February 26, 2021
5 min readLast updated: January 21, 2026
Global Banking & Finance Review®
Company
Published by linker 5
Posted on February 26, 2021
5 min readLast updated: January 21, 2026
At times, through no fault of your own, you may find yourself in a difficult financial position – like many people have throughout the pandemic. What’s worse is when you need to open a current account and find yourself being refused due to bad credit.
However, there are options out there. To help, Jonny Sabinsky, Head of Communications at budgeting fintech, thinkmoney, has answered the most common questions about opening up a current account whilst having bad credit.
“Can I get a current account with bad credit?”
If you’re applying for an account that offers an overdraft or similar features, many banks may refuse your application if you have bad credit. This is because a bank may see you as more of a risk to lend to.
However, they’re still likely to accept you for a basic account, as they’re designed to help those who don’t have a perfect credit rating. They provide a safe place to have your incomes paid into, to deposit cash and cheques, withdraw money, and set up direct debits and standing orders. They also allow you to build your credit rating by showing you can make payments on time and manage your money well.
“Am I eligible for a basic account?”
As long as you’re over the age of 18, have a form of ID, for example a Passport or Driving License, and can show proof of address, the option of a basic bank account should be available to you. However, this can depend on the bank and the specific account you’re applying for.
Six unexpected tips to boost your credit score
As soon as you have opened your basic bank account, you can begin to improve your credit score. However, here are six other ways to improve your credit score in the meantime.
Never heard of this before? You’re not alone. But for those renting, the Rental Exchange Initiative gives you the credit you deserve for paying your rent on time, whether you rent privately or through the council. It’s really simple to do, too. Just ask your landlord or social housing customer service team to add you to the initiative.
What does this even mean? Well, although it’s easier said than done, it basically means that you shouldn’t be maxing out your credit cards. You may think that as long as you pay off your credit card on time then it doesn’t matter how much is on there, right? But this isn’t the case. If you’re constantly reaching your limit, then this can look like you need your credit card to survive and that you’re not financially secure. If you can remain at least 50% below your limit (or lower if you can), then this will help to improve your score.
So, you pay off your credit card every month – great! But the only problem is that your creditors only report to the credit reference agencies once a month. If you run up a big bill and haven’t made your repayment before that report is sent, then it can look like you’re overusing your credit. How to tackle this? Where you’re able to, even if it’s a part payment, pay twice a month!
Now, not everyone has a landline telephone, but for those that do here’s a quick and easy tip to help you out. When applying for credit, the reference agencies like to see stability. With this in mind, even the smallest details can make a big difference. Having a landline telephone number ties you to a fixed address, so some lenders may be more willing to offer you a loan, mortgage or credit card if you have one.
One of the easiest ways to boost your credit score is by doing nothing. By this, I mean refrain from opening a new form of credit until at least six months after you last opened one. This shows future lenders that you’re not reliant on credit and can strengthen your application. Applying regularly for credit can impact your credit score, especially if you are declined, so sometimes doing nothing really does help.
There are a lot of myths about what does and doesn’t affect your credit score, so it’s important to be able to understand the most common misconceptions. For example, previous occupants of your home address do not affect your credit score. Instead, credit companies are only interested in those people you’re linked to financially, such as a joint bank account.
Another misconception is that your credit history is stored forever. However, the truth is that most of the information in your credit report is only stored for around six years, and in most instances, credit companies are more interested in what’s happened recently.
Finally, there’s a myth that checking your credit score or credit report impacts your score. This is not true – you can check your report as many times as you like. It’s the best way to keep on top of any changes and to see those improvements to your credit score as they happen! Checking your score doesn’t have to cost you either, most of them are free. Go check them out.
For a more in depth look at ways of improving your credit rating, check out our guide on how to improve your credit score.
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