They can be useful if you’re regularly making payments, or receiving money, in other currencies. So, a currency account could suit if you:
travel a lot
have a mortgage outside the UK
regularly earn money outside the UK
are planning on retiring outside the UK
But before jumping in, it’s worth getting familiar with some of the benefits and considerations.
With currency accounts, the money can be moved straight from one currency to another, reducing your conversion fees. You can also use currency accounts when buying something outside the UK, so you can minimise international transaction fees.
If you have multiple currency accounts, you may be able to transfer instantly between currency accounts.
If you track exchange rates, you can move money straight away when you feel the rates are favourable. This can also come in handy if you need to make an urgent international payment.
If your currency account is with an authorised UK bank, it will be protected under the Financial Services Compensation Scheme:
up to £85,000 per eligible person, per bank
up to £170,000 for joint accounts
A currency account won’t cover all currencies. When looking at providers, make sure the currencies you need are included. Keep in mind, your needs could change over time. So it may be worth looking for a provider which has a wide range of currencies available.
Some currency accounts may charge monthly account fees, or payment fees when you make transfers. If you can, it may help to avoid these as they can stack up.
You may also find some currency accounts require you to keep a minimum amount in each currency, otherwise you may be charged extra fees.
Currency accounts may not include all the features you’d expect from a bank account. For example, an HSBC Currency Account doesn’t come with:
a debit card
a cheque book
an overdraft facility
a linked lending facility
There may be conditions around who can apply for a currency account. For example, if you’re opening an HSBC Currency Account, you’ll need to be:
applying for a sole account
18 years old, or older
an existing HSBC customer (your HSBC account must be active and this excludes Basic Bank Account holders, as well as first direct and M&S Bank customers)
If you feel a currency account may be useful, make a list of exactly what it is you’re looking for. It could be:
a particular currency
no fees
the ability to transfer between currencies instantly
Or, it could be all of the above.
Once you have that list, take a look at the different types of currency accounts to find one that will meet your needs.
