Last updated on January 11th, 2024 at 12:41 pm
Many immigrants to the U.K. prefer to manage their money through an account based in the country. This can save you international banking fees and make it easier to pay bills and receive your salary. The U.K. has plenty of banks you can join, but you may also want to consider building societies and building society roll numbers.
So, just what are building societies, and why might you have to use a building society roll number when using your account? Let’s take a closer look via this Remitly guide.
What is a building society?
Just like banks, building societies are financial services institutions that have branches on high streets throughout the UK. While they look pretty similar on the surface, there are two key differences:
Services
Most building societies offer a narrower range of financial products and services compared to banks. Some provide current accounts for day-to-day transactions, along with debit cards, personal loans, and insurance. However, most building societies primarily focus on mortgages and savings accounts.
Structure
Building societies are mutual organizations, which means they’re owned by their members.
Essentially, opening an account or obtaining a mortgage automatically makes you a part-owner of that building society. It means you’ll can attend annual general meetings and vote on how the organization runs. This is purely optional, and you can simply carry on as a regular customer if you prefer.
Banks, meanwhile, are typically public companies listed on the stock market, and their main aim is to generate profits for their shareholders. By contrast, the priority of building societies is to reinvest profits to benefit members. As a result, you may find that building societies can potentially offer higher interest rates on savings accounts, and lower rates on mortgages, compared to banks.
What’s a building society roll number?
A Building Society Roll Number is a unique identifier used by building societies to recognize individual accounts. It’s a bit like a bank account number, but with its own special twist.
Decoding the roll number
Consider a roll number to be a key to unlock your account details. It’s typically used for accounts held in building societies, which are financial institutions owned by their members. These numbers are especially important when making transactions like transfers or setting up direct debits, ensuring your money goes to and from the right place.
Why it’s different
Unlike typical bank account numbers, a roll number is unique to building societies. It’s used alongside sort codes but serves a slightly different purpose. It’s shorter and often includes a combination of numbers and letters.
How do I pay money into my building society?
A few details will be required when you pay money into your building society, say, for your savings account.
As with banks, you need to enter an account number and sort code. The latter is a number that identifies financial institutions and branches within the financial network, allowing payments to be routed correctly. You can read more about sort codes in our dedicated guide.
Some building societies may provide you with a roll number on top of an account number and a sort code. It’s important to note that this may simply be called your personal or unique account number, or reference number. It refers to a string of numbers and letters that you can find in official correspondence and your online account.
As building societies often use the same account number and sort code for all transactions, roll numbers may be essential for ensuring payments go into the right accounts. If this is the case, you may have to enter it into the ‘reference’ field when making payments into your account.
The exact process can vary between building societies. Check what’s required so you don’t run into any delays when dealing with your account.
History of building societies
The very first building society, Ketley’s, formed in Birmingham in 1775. Others followed suit, and were early examples of what we’d now call ‘crowdfunding.’
Members pooled their resources and contributed to shared funds. These would be used to finance the purchase of land and the creation of homes. The earliest building societies were ‘terminating,’ meaning they’d be dissolved once all members were housed.
By the mid-19th century, building societies had changed. Many become permanent organizations, providing financial services to members indefinitely. The next big evolutionary shift came over a century later, with the passing of the Building Societies Act of 1986.
This broadened the range of services that building societies offered. It also allowed building societies to ‘demutualize’ and operate like banks. Some building societies that went down this path were Abbey National, Bradford & Bingley and Halifax.
Today, U.K. building societies manage assets of around £480 billion and handle residential mortgages amounting to around £357 billion. While some building societies have a national presence, many are smaller, regional operations. They often play an active role in their communities, contributing to good causes and encouraging staff to volunteer at local charities.
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