SPECIAL OFFER - Switch to a 1st Account and get £175*. Requires credit check. New customers only and T&Cs apply
Why we like it
Get access to a Regular Saver Account - Put away between £25 and £300 for a fixed 12 month term. If you save £300 every month for 12 months and qualify for the 7.00% AER/gross p.a. interest rate, you'll earn approximately £136.50 interest (gross). Interest is calculated daily and paid 12 months after you opened the account. AER stands for Annual Equivalent Rate. This shows you what the rate would be if interest were paid and compounded each year. Gross is the rate of interest if interest were paid and not compounded each year. No partial withdrawals allowed. Early closure will result in interest being paid at the standard account variable rate. SPECIAL OFFER - Switch to a 1st Account and bank £175*. £250 interest-free overdraft (subject to status). No minimum monthly funding and no monthly account fee. No first direct fees for when spending abroad, withdrawing cash from the UK or when making a debit card payment in a foreign currency in the UK. Mobile banking app. UK based contact centre. *Within 45 days of your account opening you need to: switch to first direct using the Current Account Switch Service (including at least 2 Direct Debits or standing orders), deposit £1,000, make 5+ debit card payments, and log on to digital banking. New customers only, who haven’t previously held a first direct product. first direct also can’t offer this to people who have opened an HSBC current account on or after 1 January 2018. Offer can be withdrawn at any time. Subject to status. UK residents only
Current accounts' interest rates vary considerably, but some current accounts pay highly attractive rates of interest – often better than many dedicated savings accounts.
The drawback is that current accounts tend to have relatively low deposit limits above which you will earn no interest. It is therefore usually sensible to keep as much of your savings as possible in a high-interest bank account, then put the rest in a different current account or other type of savings account.
Current accounts generally have two different interest rates – the one they charge you when you are in credit and the one you pay when you are overdrawn. Different current accounts are likely to be more appealing than others depending on whether you tend to be in credit or not most of them time.
AER versus APR
When people talk about interest rates, they will usually refer to an interest rate that is a certain percentage AER or APR.
APR stands for Annual Percentage Rate and is usually quoted for the interest you will pay on loans and credit cards.
AER means Annual Equivalent Rate and is used for the interest you earn on your savings. AER is the amount you would earn if your interest was only paid once a year, whereas in reality current accounts usually pay interest monthly.
