A lot of people seem to think you can only have one bank account at a time. But you can actually have multiple current accounts with various banks.
Having more than one bank account should not affect your credit score, unless you try to open loads of new ones in a very short space of time.
And if you open a new account, you don’t need to switch all your payments over from your old bank or the accounts that you already have, unless you want to.
Why would I have more than one account?
There are a few reasons why having more than one account might be useful:
Trying out a new account: In recent years the industry has become a lot more competitive, and each bank offers something different. Using different banks to try out different bank accounts can help you see whether the products, services or features of another account suit you. Overdraft limits, for example, differ from bank to bank and therefore might suit different people. Here's how overdrafts work at Monzo.
You’ve found another provider you prefer: Whether the app's easier to use, the customer service is better, or the bank has a branch near you, you might have shopped around and found a new account you like.
Taking advantage of offers: Many banks offer cash back or short-term deals to encourage you to switch, so you can make a bit of cash when you open a new account.
Earning interest: Some banks pay interest on the money you have in your current account. But many have a maximum balance that they pay interest on. Savings accounts and ISAs can earn you interest too but this is often at a much lower interest rate than the rate offered on current accounts. Some savers open multiple high-interest current accounts to get the most out of their money.
Keeping your money in your current account protected: If the money in your current account is over the £85,000 limit for FSCS protection, you might want to spread your money across multiple current accounts. This will guarantee it’s protected if anything should happen to your banks. Just remember, some banks (like HSBC and First Direct) are linked, so the £85,000 limit applies to the money you have at both banks.
Staying organised: If you’re managing a few different incomes or you're looking to open a joint account, you might find it helpful to keep a few different accounts open.
If you're thinking of opening multiple accounts, there are also a few things worth bearing in mind:
Don’t open loads of accounts at once: If you open many different bank accounts in a short period of time, it could negatively affect your credit score and your ability to borrow money in the next few months.
Check you can meet the minimum requirements: To stop people opening new accounts just to take advantage of signup offers, some accounts require you to pay a minimum amount of money in or out each month. Others might ask you to have a direct debit set up which might make multiple current accounts difficult to manage. If you’re thinking of opening a new current account, remember to check you can meet all the requirements.
How do I open a new account?
You can usually open a new account online, through the app, or by going into a branch.
Signing up for Monzo only takes a few minutes. Just download the app, follow the instructions to get started and you should receive your debit card in 5 working days. The only thing you’ll need to hand is some valid ID!
Switching payments over
When you open a new account, you can decide if you want to switch any payments over from your old bank, and choose whether you want to close your old accounts or leave them open.
If you do want to move payments over to your new account, you can use the Current Account Switch Service. It helps you switch some or all of your payments between banks that support the service. And switching only takes a few taps!
A partial switch lets you choose particular payments to switch to your new current account, or move all of them over but keep the old account open. While a full switch moves all of your payments over and closes your old account.
To learn how to make the most of your money, head to Monzo Money Tips! 💸