The Struggles International Students Face when Spending in the UK
Time and time again the world explores the difficulties international students face when moving to the UK to study. We learn about the battles to adapt to the culture, language, and financial spending. Yet, so little is done to accommodate those struggling. Yes, there are communities and societies created to support students, but what about active financial backing? After scanning through research, I discovered there’s not a lot aiding the hardship that international students experience when faced with how to even set up a UK bank account. There is even less promotion of how to spend if a student doesn’t want to set up a UK account. It seems UK banks have made it extremely difficult for international students, and here’s why.
If an international student wants to study in the UK, they need to have easy access to their money. Let’s assume they don’t get a UK bank account and keep their national current account — what are the problems with this? Firstly, a BBC financial advisor shared that it is virtually impossible to live in the UK without a UK bank account. After my own basic search, I uncovered that it is, in fact, possible, but causes a lot of unnecessary complications and issues. Some peer-to-peer payment platforms charge enormous fees for regular international transfers to process; losing you money. Say you order something overseas: it will take a while to transport. Between when you have ordered the product and the time it takes to arrive, the foreign exchange rate may fluctuate. This means there is uncertainty towards the exact amount actually being spent! As a student, who is paying heft tuition and living fees, and unlikely to be earning; it is more important than ever to be able to keep track of money.
Similarly, without a UK account, students from certain countries (eg. China) are unable to pay by card, which means they must pay in cash. In a current and post-covid society, the western world has rocketed towards contact-free ordering and spending, which causes seemingly unsolvable issues for international students. In addition to this, international students in many cases, must pay to use cash machines — again losing more valuable money. All of these issues with the logistics, hidden/added costs of using a foreign account, point towards opening a UK bank account. But is that even a viable option for international students?
It would seem not. Banks in the UK make it complex and tiresome for international students to create an account. The process is slow and difficult, making it confusing and complex. The bank requests many documents, and a major one includes proof of permanent residency in the UK. The banks suggest getting the account sorted before moving to the UK because of the lengthy process (they say two weeks for UK citizens but longer for international) of setting up the account. This is understandable, but problematic for undergraduate students, because many don’t receive their exact UK University address until they are at the university itself. The result of this means many risk being left stranded in a new country, new city, with new strangers, and without a source of funds to look after themselves.
You might expect there to be support from the universities or banks in the creation of an international student account. On the contrary, many international students aren’t eligible for that either. This is because student accounts are marketed towards UK students. Although students have a low income and budget, in the long term, UK students will start earning more when they leave university. Banks therefore, are investing in the potential of UK students becoming future, profitable customers. Whereas, the bank does not benefit from international students, who will likely return home after university, so they do not fit the customer profile. This little support for international students is clearly an issue.
After all of these disadvantages, if an international student insists on opening a student account, it is possible. But there is likely to be a monthly account fee or minimum balance requirement, which both put unnecessary financial pressure on the student. Yet, even this option isn’t available for Chinese students (who make up the population of 43 530 students, and 35% of all non-EU students are from China in the UK), as they are unable to open a bank account outside of China without a permit, which is very tricky to acquire.
This leaves international students with very few options surrounding how they spend and take care of their money; even less considering the current social and economic climate. Many international students are nervous enough travelling to the UK for university due to watching the steep cases of coronavirus climb. The last thing they need is to also be concerned about finance. So what is being done to resolve this major, worldwide problem?
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