In this climate of ultra low savings rates, current accounts now pay more than many traditional deposit accounts. Savers are increasingly turning their back on cash Isas and fixed-rate bonds, opting for current accounts that pay up to 5pc instead. Since April 6 2016, the first £1,000 of interest earned by basic-rate taxpayers on their savings, and the first £500 earned by higher-rate taxpayers, is no longer touched by the taxman. Here you can find some interesting bank accounts with several important deals.
Nationwide FlexDirect Account
Nationwide’s FlexDirect current account pays a rate of 5pc on balances up to £2,500 for the first 12 months. After the initial 12 months, the account reverts to a 1pc rate, so make sure to switch when the introductory offer ends. You can earn up to 125£ in a year.
Tesco Bank current account
As savings rates tumble Tesco has promised to guarantee the 3pc rate of its current account until April 2019. However this is only paid on balances up to £3,000. You can earn up to 90£ in a year.
Santander 123 Current Account
The Santander 123 current account offers cashback on household bills paid by direct debt. Customers can earn between 1pc and 3pc on water and council tax, energy bills and broadband packages. In addition, Santander mortgage customers receive 1pc cashback on repayments up to £1,000 a month. You can earn up to 240£ cashback in a single year. There are also several basic bank accounts for free. They are no-frills current accounts without fear of running up debt. Here some example: Co-op Bank, Virgin Money, Bank of Scotland, Barclays, Yorkshire Bank, Hsbc, Ulster Bank and Rbs.
Finally, if all you want is an account to receive your pension and benefits, the Post Office Card Account is an alternative to a basic bank account. There are no credit checks to open one, but you’ll need to contact the government department that pays your pension, benefits or tax credits and ask them to set you up.
You will get a card to withdraw cash and check your balance at your local Post Office branch. But, as well as no overdraft facility, you can’t set up any direct debits or use your card in shops/online.