24 August 2006
Halifax has warned students that gimmicky student accounts could end up costing consumers in excess of £630.
With many student accounts offering free gifts such as iPod Shuffles, Halifax has stated consumers should be paying more attention to the interest-free overdraft a bank offers.
Rather than opting for "free gifts" worth a maximum of £100, Halifax suggests students pay greater attention to the lower interest-free overdraft limits which different banks offer.
With different banks offering different interest-free overdraft limits, the study shows that some students may have to use a credit card (typical APR 15%) for their extra spending – a means of borrowing that will ultimately cost them more.
Peter Jackson, HBOS managing director, said: "The best advice is always to avoid getting in debt in the first place but for most students that's just not possible.
"So the next best advice is to borrow money as cheaply as possible and that's why it's important not to be taken in by the lire of free gifts and to concentrate instead on the interest free overdraft limits which are on offer."Compare current accounts and find the best current account for you with the uSwitch.com's free comparison service.
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