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Student accounts 'are a good thing'

By Sarah Engle, Wed 13 Aug 2008 - Published in Banking

The high level of debt students leave university with as a result of loans, overdrafts and credit cards has been well-documented in the media.

However, the Consumer Credit Counselling Service has said bank accounts specifically aimed at students do not "necessarily promote debt".

Spokesperson Frances Walker said students have to fund their education somehow.

Nevertheless, she stated it was important for students to choose their accounts carefully.

She claimed accounts offering "gimmicks" like iPods should be avoided and prospective students should focus on features like the interest rate and overdraft facility.

Ms Walker said overall student accounts were a good thing.

She stated: "They have very attractive rates of interest and a free overdraft up to a certain amount and things you wouldn't get on an ordinary account."

According to the national money education charity Credit Action total personal debt in the UK at the end of June was £1,444 billion.