If you are struggling with personal debt one of the first steps to getting back in control is often to open a new bank account. This is because you need to make sure that any money paid into your account is fully under your control.

If you continue to use a bank account which is operated by one of your creditors they may take money from your account without your authority. They are allowed to do this under the right of offset.

The problem you face is that if you already have a poor credit rating you may be blocked from opening a new current account. So what can you do? We explain your options.

If you have a poor credit rating ask for a basic account

If you apply for a new current account the first thing the bank will do is carry out a credit check on you. If you have debt problems and have missed payments, your credit rating is likely to be poor and you will fail the check and your application will be refused.

For this reason if you believe that your credit rating is poor you should be up front about this. When you speak to a bank, tell them that you may not pass their standard credit check and so you require a simple bank account with no credit facilities.

This type of account is often known as a basic account or a card cash account. Many high street banks offer a basic bank account facility which they will open for you without needing to pass a standard credit check.

No credit facilities

A basic bank account will allow you to set up standing orders and direct debits. However the downside is that you will not be offered credit facilities such as an overdraft.

Another problem with many basic accounts is that you will not be given a debit card. Some basic bank accounts such as the Co-Op cash minder do offer a debit card facility. However if the bank you have chosen does not, you can consider getting a pre-paid debit card.

Pre-paid debit cards

Update: Most banks now issue their simple bank account customers with a debit card as standard and for free. This has massively reduced the need to apply for a pre paid debit card.

If you have not been given a debit card with your new bank account but need one you can apply for a pre paid card. This is a debit card look-alike issued without credit checks and works on a top-up basis. You deposit money onto the card and then you are free to spend it however you like. You must remember however that pre paid cards are not issued and operated for free. You will pay different fees depending on the card you take.

In today’s economic environment, it is not unusual for someone to want to open a new bank account. This process is no longer unusual as is normally very straight forward. In fact, as with many financial products, if you do not keep your eye on your account compared to the promotions offered by different banks, you may well loose out and in fact end up paying for a service that you could have had for free elsewhere.