Banking/Savings Section

How To Use A Natwest STEP Account To Pay Bills

March 2006

We heard about this little trick from a colleague last week and it can really make things easier for someone with a Natwest Step Bank Account. A Step bank account is designed for those that have trouble opening a normal style bank account, perhaps because they've got CCJs or Default notices on their credit file (Read how to get Default notices removed).

A Step account offers no chequebook, no credit card, no overdraft facility but does come with internet banking and a Solo cash card which can also be used to pay for goods in most of the big chains and stores.

However, it cannot be used to pay bills online or via telephone banking, nor can it be used to transfer money to another bank account. But there is a trick to get around this limitation.

How To Use Telephone Banking To Pay Bills With a Step Account

• First you have to open a Natwest First Reserve savings account, this can either be done online www.natwest.com or at any branch
• The First Reserve is a very simple deposit/savings account which pays a pathetic interest rate of around 1.5%, but this doesn't matter because you're not going to be using it to save money in
• Once the account is opened you'll be able to access it from the same screen on your internet access
• With you Step account if you try to use the 'Payment' button it will tell you that your account does not support this function
• But call Natwest up on their 24 hour customer line 0845 601 3366 transfer money from the Step to the First Reserve and then make the payment using the First Reserve account
• For example, you owe £20.47 to BT, phone Natwest get them to transfer £20.47 to your First Reserve then get them to pay BT from that account, all this will take less than 3 mins. Natwest have an excellent telephone banking service and with it being 24 hours you can call whenever you want

Why Is This Important

This perhaps sounds more long winded that it actually is but it's very important because many of the people with Step accounts have been unorganised with their financial affairs in the past, especially no doubt when it comes to paying bills. And as a Step account doesn't come with a cheque book many bills have to be paid down at the bank which can be a hassle, getting to town, waiting in line etc.

Using this strategy one can remain fully on top of all money that has to be paid out and it only takes a few minutes.

See Also

• Natwest Website for more details on the First Reserve account