This comparison simply includes all savings accounts.
Current Account Interest Rates
Why we like it: 2.00% interest for 12 months on balances up to £1,500 for the first year. You must pay in £1,000 or more each month to receive interest (excluding transfers from any Nationwide account held by you or anyone else). 12 month fee-free arranged overdraft available. No monthly fee. Access to Flexclusives - Select Credit Card and low personal loan rate. Must be aged 18 or older
Why we like it: Earn 0.60% AER (variable) interest on balances up to a maximum of £20,000. Up to 3% CASHBACK on various household bills. Monthly fee of £5. Cashback capped at £5 for each cashback tier each month. Must pay in £500 pm.
Why we like it: Get set up in minutes. No paperwork, monthly fees or branch visits. Send money abroad: Fast and secure money transfers to bank accounts in 38 countries worldwide. No fees when you pay with your card abroad or withdraw money. Real Mastercard exchange rates and real-time notifications in both currencies. Get a spotlight on your spending: See what you’ve spent instantly with real-time payment notifications. Current account is completely free.: No charge for making electronic payments, domestic transfers or ATM withdrawals. Three-month interest holiday on the first £500 of an arranged overdraft. Earn Interest: current account pays 0.05% AER on balances up to £85,000.Card gone missing? Lock it in-app temporarily while you look for it or cancel it with a tap if you think it’s gone for good. Personal loan available that’s straightforward to use, competitively priced and tailored to you. Best British Bank and Best Current Account in 2018, 2019 and 2020 at the British Bank Awards. Awarded 5 stars by Defaqto too. Fully registered bank and a member of the Financial Services Compensation Scheme (FSCS), so any money you keep will be fully protected, up to £85,000
Why we like it: UK & Europe Breakdown Cover, Worldwide family travel and mobile phone insurance, and commission-free cash withdrawals and card payments abroad. Free mobile banking app, text alerts and secure online banking. Access to Flexclusives - Select Credit Card and low personal loan rate. £13 monthly account fee
Why we like it: Everyday current accout. No monthly account fee. Access to Flexclusives - Select Credit Card and low personal loan rate.
Understanding current account interest rates
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 current 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.
Compare current account interest rates
To find the best current account interest rates, you need to compare current accounts from all the top providers on the market. The current account comparison table at the top of this page makes this process quick and simple, allowing you to find a great deal with minimal hassle.
Below are three of the top current accounts available right now:
Santander 123 current account
This account offers 1.50% AER/1.49% gross (variable) on balances up to £20,000. You can also earn cashback of 1-3% on a variety of household bills. This includes payments on a Santander mortgage or insurance policy.
This account has a £5 per month account fee. You must make a minimum monthly deposit of £500 and have two active Direct Debits to qualify for cashback.
TSB Classic Plus account
You can earn 3% AER interest paid monthly on balances up to £1,500 with a TSB Classic Plus account. You can also get £5 per month cashback if you have at least two Direct Debits from the account and another £5 per month when you use your debit card at least 20 times in that month.
There is no monthly account fee, but to earn interest you must pay in a minimum of £500 each month.
Nationwide FlexDirect current account
You get a market-leading 5% AER (4.89% gross p.a.) interest on balances up to £2,500 for the first 12 months with this account. However, the interest then drops to 1% gross p.a./AER (variable), so it may be worth switching to a different account after the first year.
There is no monthly account fee, but you won’t earn any cashback and you have to pay in at least £1,000 a month to earn interest.
