Opening a bank account

Learning outcomes The main learning outcomes for this lesson are: Learn how to open a bank account. Understand Internet banking and how it works. Gain an understanding of cheques, debit cards, credit cards.

Starter You must complete the worksheet called Banks. You need to write down in the table provided as many different banks and building societies as they can think of. The you need to write reasons for having a bank account. You have 3 minutes for this activity. Banks and Building Societies Reasons for having a bank Account  

Answers Banks and Building Societies Reasons for having a bank account NatWest Barclays Nationwide Halifax HSBC Lloyds MetroBank Other similar services such as goHenry, MINT and PayM   Somewhere to put your money It is a secure place You can gain interest on your money You can avoid having to carry large amounts of cash as on some accounts you get given a debit card You can get money out of a cash machine and top up mobile phones

Opening bank accounts There are two short videos to watch. The first one is about how to choose a bank account. It lasts 2 minutes 51 seconds. https://www.youtube.com/watch?v=5n1nixLSrQI The next video is about how to open a bank account. It lasts 1 minute 47 seconds. https://www.youtube.com/watch?v=XZoc2Cv3BAE

Step by step guide to opening a bank account Steps for opening an account Start by writing down what you want from a bank account e.g. to put money in and be able to have a card to use at a cash machine, etc. Now you need to compare bank accounts. You can do this by using the internet and looking at different banks to see what they offer. Decide whether you want a traditional High Street bank account or whether one of the new mobile banking services is right for you. Once you have decided on the bank account ,either get your parents to go online and sign up or book an appointment to see their advisor. At a High Street bank you will need to take your parents with you to the meeting, you will also need to take your passport and birth certificate. The bank will need these documents for identification. You will not be able to open an account without them. During the meeting the advisor will explain the account to you and your parents in detail. They will get you to fill out an application form which you and your parents will need to sign. With an online service, all this can be done from your parent’s computer. Once this has all been set up you will be given your own account number and sort code. You will need to open the account with a small deposit – maybe as little as £1.00. Once this has been completed you will have your very own bank account. Just remember at the end of each month you must read your bank statement carefully to make sure it is correct.

What is the difference between debit cards, credit cards and pre-paid cards?

Debit, pre-paid & credit cards Debit cards – you have to have an account to get a debit card. You must be 12 to have a card. It allows you to:- Withdraw money from your account at a cash machine, this comes straight out of your account. Deposit money into your account. Pay for items on the internet. Pay for items in shops. Pre-paid debit cards – again you have to have an account to get a pre-paid debit card but you can get one as young as 8 years old. It does everything that a debit card does but also makes sure that you cannot spend money you don’t have. Credit cards – you have to be over 18 to have one. A credit card is where you are borrowing a certain amount of money which you will need to pay back with interest to the bank. It allows you to:- Withdraw money from a cash machine, this can be paid back at a later date. You can use them aboard on holiday. With some bank accounts you may still be given a cheque book. A cheque is an old-fashioned form of payment for items. A cheque informs your bank to transfer money from your account to pay someone else. The Government is planning to do away with cheques in a year or two as most people prefer to pay by card or transfer money direct from their bank accounts these days.

Cheques Activity Here is a standard cheque layout. You will be given a blank cheque like the one above, your task is to have ago at filling it in. Put todays date in the date section. You have 3 minutes!

Cheques

Cheques Explained Issuing bank payee Date of payment Amount in words Signature of drawer Account number Bank sort code

Internet banking Internet banking lets you do your banking at home rather than by going into a bank branch. It allows you to do the following transactions online: View bank statements (past and present) Transfer money from your account to somebody else’s. Pay bills Set up direct debits (this allows you to make regular payments to a business or individual) Order a new cheque book or debit card Change personal details e.g. home address, etc.

What are the risks that can occur with online banking?

Possible risks: The possible dangers are: Hacking – someone could hack your bank account and steal your identity. Secure logins – You need to check that your bank has a completely secure login area. Computer viruses can infect your laptop or PC and redirect your web browser to a mirrored site. They can look identical so users do not always know about them. Make sure you check what extra measures your bank has taken so this doesn’t happen. Usernames and passwords – do not use the same username and password for all accounts. If someone stole your details they would be able to get into your bank accounts. You should also change them regularly. Emails sent from banks – A bank will never send an email asking for personal details. If you get an email from your bank asking you to use the link provided to log in do not do so as your bank would not ask for that. If you are at all concerned, call your bank and ask them if they sent the email. Use virus software on your computer to help stop viruses like this.

Advantages Doing transactions from home. Not having to go to the bank each time you want to pay a bill, etc. You can request a new cheque book or debit card anytime. You can use it 24/7. You can see your balance at any time without having to wait for a statement.

Plenary Complete the word search on banking. You have 5 minutes!