Half of current accounts pay 0.1%

26 July 2006
Almost half of the products on the current account market in the UK pay just 0.1 per cent interest on credit balances and nearly two thirds pay less than one per cent, according to a survey by MoneyExpert.com.

There are 99 different current accounts available at present, which overall pay a paltry 1.2 per cent interest on positive balances, despite the highest dividend products paying up to five per cent interest.

The market has been shaken up recently by the much-publicised launch of several new high-interest current accounts from big players such as Nationwide, Halifax and the Bank of Scotland.

However, consumers still show lethargy when it comes to choosing a current account provider, according to MoneyExpert.com's chief executive Sean Gardner.

"The reality is unfortunately that current account rates remain inexplicably low with most firms paying customers next to nothing in interest when their accounts are in credit," he said.

"An interest rate of 0.1 per cent is simply not justifiable. There are plenty of good deals out there though and customers should make the effort to change their account if they are unhappy with their bank.

"Our research shows around 2.9 million people planned to change accounts this year," Mr Gardner added. "Frankly a lot more of us should be doing that."

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