Money in the UK


British currency notes and coins


Money is a necessary source of security. We need money to pay for necessities, such as food, housing, education, and healthcare, and it is nice to have enough money for luxuries such as a car or a holiday. When you first arrive in the UK, it is important to understand the UK currency and ways of managing money.

UK Currency

The UK uses the Pound Sterling (stg) with pounds (£) and pence (p), and the value is measured against the Euro (€) and US dollar ($).

  • It is a decimal currency with 100 pence in a pound.
  • There are notes and coins of both pound and pence values.
  • Notes – Four notes represent pound (£) values, which vary in colour. There are different banknotes for England, Scotland, and Northern Ireland.
    o £5        o £10
    o £20      o £50
  • Coins –There are eight coins for pence (p) and pound (£) values. The coins vary in colour and shape.
    o 1p        o 2p
    o 5p        o 10p
    o £1        o £2
  • Credit card or contactless payment – Since COVID, many establishments will only accept credit card or “contactless” forms of payment.
    • Contactless payment – paying for something by tapping or waving your
      contactless device (usually credit card, debit card or smartphone) over a
      reader, which accepts the payment.
      o Credit card – a line of credit used to make purchases, balance transfers and/or cash advances. Make sure you pay it back on time, as interest is charged on any monies not paid back in a month and quickly adds up.

    Bank Accounts

    While you don’t have to have a bank account in the UK, you may find it very difficult to exist without one. Bank accounts allow transfers or lodgements into your account, and the payment of utility bills, rent, mortgages etc, now tend to be online. You can open an account at banks, building societies or the Post Office, depending on the range of services offered. An account can be opened in your name, or jointly with others, i.e., you can do this to manage household bills with someone you live with or with your partner/spouse. There are different types of bank accounts.

    1. Current account.

    2. Basic bank account.

    3. Digital banking.

    4. Savings account.

      1. Current bank account

    The most common type of bank account available from all high street banks and some building societies.

          • Your current account allows you to manage your money, such as.
            • Paying bills.
            • Receiving money – i.e., salary or benefits.
            • Tracking money movements.
        • You should receive a debit card (sometimes known as an ATM card).
        • Debit cards can be used to make payments and take out cash from cash machines.
        • You may get a cheque book.
        • You can set up direct debits and standing orders from your account.
          • Direct debits – permission to take variable amounts of money from your bank account on an agreed date i.e. for utility bills. The company must tell you of any change to the amount or payment date.
          • Standing orders – instruction to pay an exact amount to a third party account regularly, i.e., a standing order for rent.
        • You may be able to set up an overdraft.
          • Overdraft – lets you borrow money by taking out more money than you have in the account – go “overdrawn”. There’s usually a charge for this, and it can add up very quickly.
        • When setting up a current account, check what charges, if any, apply.
      1. Basic bank accounts
        A free bank account that offers similar services to a current account but without an overdraft facility. They are available from most high street banks and some building societies.
            • Useful if you have a poor credit rating or a low income.
            • You cannot open a bank account at the Post Office, but some banks let you manage
              your account at a Post Office branch.
            • The conditions are:
              • Don’t need to have money to open the account.
              • Don’t have to pay any fees.
              • Can pay your wages, salary, benefits and tax credits directly into the account.
              • Can pay in cheques and cash.
              • Can pay bills by direct debit.
                • You may be charged a fee if there is not enough money to cover any direct debt payment.
              • Can withdraw money from cash machines.
            • You won’t have a cheque book or be able to go overdrawn.
            • Not all basic bank accounts can be accessed at the Post Office; check with the bank before you open the account.
      2. Digital banks
        These are online only and have the following conditions.
          • Have current accounts accessible by downloading their apps onto a mobile device.
          • Some online banks offer a current account where you do not need proof of address, but if they provide a debit card, they will require a UK address.
          • You may have to pass a credit check.
          • All banking is done through the app, and you cannot go into a branch to speak to someone.
      3. Savings Accounts

    You can open savings accounts at most banks, building societies and Post Offices. They allow you to:

          • Put away money for the future.
          • Provides a safe place for you to put your money so it earns interest.
          • Depending on the account, any amount of money can be paid on a regular or ad hoc basis.

    Requirements to open an account.

    Financial institutions will make checks on all potential customers, regardless of status or nationality, to prevent fraud or money laundering. The process can take time, but you need to:

          • Complete an application form either in the branch or online.
              • If not sure of the information required, go into the branch to discuss in person – though you may need to make an appointment first.
          • Prove your identity, which will require additional documentation depending on regulatory requirements and specific bank conditions.
          • The following has been adapted from an information leaflet from the Refugee Council, Bank Accounts, Getting Started.
            • Proof of identity
              • Current passport.
              • Biometric Residency Permit (BRP).
              • Department for Work and Pensions letter confirming right/entitlement to benefits.
              • Current full or provisional UK driving licence.
              • UK Home Office travel document.
              • UK Home Office application registration card.
              • UK Home Office immigration status with the right to reside.
              • Notification of another government/local grant.
            • Proof of address
              • Council tax bill.
              • Tenancy agreement.
              • Utility bill (electricity, gas or water) from the last 3-4 months.
              • HMRC Tax notification.
              • Department for Work and Pensions letter confirming right/entitlement to benefits.
              • They may accept a letter from a responsible person who knows you, such as a GP, teacher, social worker or probation officer.

    Terms and conditions

    Opening an account involves a contract between you and the provider, and the contract’s terms and conditions (T&Cs) will change according to the provider and the type of account you want. You should be informed of the following:

            • Terms and conditions before you open an account.
            • Any changes to the terms and conditions while you hold the account.
            • Notified of
              • Details of all charges.
              • How you will receive information about your account.
              • Any spending limits on your account.
              • What to do if things go wrong.

    Protecting your money

    There are many ways to “scam” people of their money, so be careful.

        • Never share your password or PIN to your account with any third party, including the provider.
        • Be careful of phishing (email scams) and smishing (text scams), and do not open any links you do not recognise.
        • Be careful of investment scams.

    Financial or other forms of benefits

    Depending on your immigration status, you might be entitled to “public funds” benefits. To find out any entitlements for you and your family, visit the following sites.

    Further information and helplines

        • Citizens Advice – on all debt and money banking queries.
        • Citizens Advice Bureau (CAB) – to find your nearing CAB.
        • GOV.UK – if a bank or building society refuses to open an account.
        • Financial Ombudsman Service – if you experience any form of discrimination.
        • Money Helper – a free independent service advising on financial products.
        • Refugee Council – information on how bank accounts work with information available in English, Arabic, Farsi, Kurdish, Pashto, and Tigrinya.
        • Welcome – a guide for refugees – while aimed at adults recently granted refugee or Humanitarian Protection status in England after claiming asylum, it contains useful information for anyone moving to the UK.


    Last updated August 2023