Earn up to 5% AER on your cash!

Some of the best rates of interest you will get on cash currently are on current accounts. E.g Nationwide offer 5% AER fixed (4.89% gross pa) in credit interest on balances up to £2,500 for the first 12 months

You can also benefit from switching your account. A number of banks now offer switch incentives. HSBC are currently offering £150 if you switch your current account to them. The good news is that switching is a lot easier than it used to be – basically the new bank account provider will do all the work in setting up your direct debits and standing orders etc.

For students looking for a good account Santander UK are offering a free railcard for 4 years as long as you are 18 and are in or are about to enter into full time further education.

Nationwide FlexDirect Account

Earn 5% AER Fixed Interest

  • On balances up to £2,500
  • Interest paid for first 12 months
  • No account fees
  • Easy online account management

Nationwide FlexDirect Account »

Offers

High Interest Current Account Offers

Account
Nationwide FlexDirect Current Account
Interest Rate
5.00%
AER fixed on balanced up to £2,500
Funding Required
£1,000 per month
Overdraft rate
0% for 12 months
Account
Nationwide FlexAccount Current Account
Funding Required
No minimum
Arranged Overdraft rate
18.9%
Account fee
No fee
Account
Nationwide FlexPlus Current Account
Interest Rate
3.00%
AER fixed on balanced up to £2,500
Funding Required
No minimum
Arranged Overdraft rate
50p per day
Account
Santander 1|2|3 Current Account
Interest Rate
1.50%
AER fixed on balances up to £20,000
Funding Required
£500 per month
Overdraft rate
Up to £3 per day
Special Offers
Up to 3% cashback on household bills

Current Account Offers With Switching Incentives

Account
Santander 1|2|3 Student Current Account
Funding Required
£500 per term
Overdraft
£1,500 Interest Free increasing to £2,000
Details

A free 4-year Santander 16-25 Railcard which could save you 1/3 off rail travel in Great Britain

UK Current Accounts With Overdraft Facilities

Most current account providers will offer a overdraft facility with your current account but the fees charged can vary significantly from one bank to the next.

Some banks offer a no fee arrangement up to a set threshold and also may offer a interest free limit as well.

The fees charged for using a authorised overdraft limit can also vary as can the interest rate levied. the same can also be said of unauthorised overdraft use.

In recent years there has been pressure on banks and building societies to reduce their charges for current account banking. If you are looking to change your current account provider it can pay to shop around.

With the Bank of England Base Rate falling to historical lows over the last 5 years, there are not many current account providers who pay what you would call high interest on the account balance.

While the Base Rate increased last month by 0.25% banks are in no hurry to pass this rate rise onto customers.

Typically most banks and building societies pay either a nominal amount of interest or no interest at all.

Some providers will pay higher interest on the first say £1,000 held on the account, and then pay a much lower rate on money held over this amount.

Currently the highest paying interest current account in the UK presently is the Nationwide Flex Direct Account paying 5% on up to balances of £2,500. After a year the account drops to 1%.

You could also consider their FlexPlus Account which pays a lower 3% on or up to £2,500, but with the rate staying at that level. However to get this deal a monthly fee of £13 is charged for the privilege.

For savers with larger deposits of money Santander 123 Account pay 1.5% on balances up to £20,000 plus you get 3% cashback on household bills paid from your account. This account comes with a monthly £5 fee.

It is in August and September that UK Banks start to bring out their latest student current account offerings. Banks are understandably keen to get your business. Research shows that one you set up a current account you are unlikely to move it.

 

Your new bank is responsible for contacting you before the switch date if there are any hitches with transferring your standing orders and direct debits – and incoming payments.

And the switching service is covered by a guarantee: the new bank must refund you if there are any charges because payments didn’t go through on time.  But you have to ask them for this.

Yes – you can use the partial switch service and keep your old account open, transferring all or some of your payments. But the process isn’t covered by the service guarantee so it can take longer: possibly up to 20 working days. And there isn’t an automatic-redirect for the three years after you switch. A partial switch may not qualify for the incentives offered for switching (though that shouldn’t be the only reason why you change accounts).

Not all your regular bill payments may be made by direct debits or standing orders. Some service providers (such as telecoms services, online subscriptions, gym membership and payday loans) get you to set up a “recurring payment” or “continuous payment authority” which is linked to your debit or credit card

Because they’re linked to a card rather than directly to your bank account, they’re not included in the switching service (or covered by the guarantee).

It’s not always clear which are your continuous payment authorities: you won’t find them listed on your online banking portal. When you set them up you were asked for you card details (“please read me the long card number”) rather than your bank account and sort code numbers.

You’ll need to check your monthly card statements: any regular payments going out each month that are not marked as DD (direct debit) or SO (standing order) are likely to be continuous payment authorities.

If you want to keep paying for this service (or loan) in this way, you’ll need to contact each provider and tell them your new card details as soon as you have them.

This may sound like a lot of bother, but it is useful to check periodically what’s going out of your account regularly: there may be services you’re not using (such as fast delivery, or additional online data storage) that you want to cancel.

If you can remember the family members or friends who occasionally transfer money directly to your bank, you can send them your new account details and ask them to set them you up as a new Payee.

It’s probably not a good idea to just email all your Contacts with your new account details. If you’re concerned about email security, the most secure way of sending bank account details to specific people is via WhatsApp.

And if any payments are accidentally made to your old account, for 36 months (three years) after you’ve switched, your new bank or building society will arrange for any payments to be automatically redirected to your new account. They will also contact the sender and give them your new account details.

You can pick any convenient day in the month, so long as it’s more than a week away, and not a weekend or a bank holiday.

If all your regular payments tend to go out of your account around the same time it’s best to choose a time of the month when your bank account isn’t so busy.

No Credit Check Prepaid Card

Nationwide FlexDirect Account

Earn 5% AER Fixed Interest

  • On balances up to £2,500
  • Interest paid for first 12 months
  • No account fees
  • Easy online account management

Nationwide FlexDirect Account »

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