High Interest Current Accounts

Compare Mobile & High Interest Current Accounts

Santander 123 Current Account

Earn 1.00% AER Fixed Interest for up to £20,000

  • 1.00% AER (variable) payable on your entire balance up to £20,000
  • Up to 3% cashback on household bills
  • Must pay a minimum of £500 into the account each month
  • Monthly fee of £5
  • Mobile app

Our view: With this current account you get 1.00% AER on the first £20,000 of your cash. To qualify you will need to pay in £500 pm (Equates to a £6,000 pa salary) . Additionally you can gain up to 3% cashback on household bills – 1% on water, council tax bills and Santander mortgage payments, 2% on gas and electricity bills, and 3% on mobile phone, home phone, broadband and paid-for TV packages.  The account has full savings FSCS protection.

Santander 123 Account »

High Interest Current Account Offers

Account
Santander 1|2|3 Current Account
Interest Rate
1.00%
AER fixed on balances up to £20,000
Funding Required
£500 per month
Overdraft rate
39.9% APR/EAR (variable)

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.

 

Some of the best rates of interest you will get on cash currently are on current accounts. E.g  Santander offer 1% AER fixed  in credit interest on balances up to £20,000 for the first 12 months.

You can also benefit from switching your account. A number of banks now offer switch incentives.

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.

Things to consider:

  • Do you need an overdraft facility? High interest current accounts rarely offer attractive overdraft facilities, so if this is a priority then you may be better looking for a current account with competitive overdraft fees.
  • Are you looking to use your debit card on a regular basis abroad? If this is important then you should look at a options provided by some of the new mobile bank current account providers such as N26 and Monese.
  • Monthly account fees. Make sure the fees you pay outweigh the benefits of the account.
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