Compare High Interest Current Accounts
High Interest Current Accounts
Why we like it: 5.00% interest for 12 months on balances up to £2,500 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. Must be aged 18 or older.
Why we like it: 3.0% AER fixed interest on balances up to £2,500. No fees on arranged overdrafts up to £250. UK & Europe Breakdown Cover, Worldwide family travel insurance. Free mobile banking app, text alerts and secure online banking. £13 monthly account fee
Why we like it: Earn 1.50% AER (variable) interest on balances up to a maximum of £20,000. Up to 3% CASHBACK on various household bills. Monthly fee of £5. Must pay in £500 pm.
Why we like it: Free gift worth up to £150 for switching into account. £250 interest free overdraft. Free banking if paying over £1,000 per month. Satisfaction guarantee - £100 if you leave within 6 months
Why we like it: Everyday current account. 3 months interest-free overdraft and no monthly account fee
Why we like it: Earn rewards of up to £180 a year when you bank with Barclays - Get an annual loyalty reward of £84 plus £60 on your Barclays residential mortgage and £36 on your Barclays home and contents insurance. Start earning rewards with a monthly £3 fee based on £800 paid into your account and 2 direct debits paid out every month
High interest paying current accounts
Some of the best interest accounts in the UK market presently are current accounts.
The good news is that while general interest rates are low, a number of high street banks are keen to attract new customers and are offering high interest current accounts paying up to 5% AER. We have summarised some of the most popular accounts currently on offer:
TSB Classic Plus Current Account
TSB offer a great deal on its Classic Plus current account. This account has one of the lowest minimum monthly pay-ins at £500 per month so is well-suited to anyone who finds it difficult to meet the minimum payments of some other accounts. But also offers the highest rate of interest.
The TSB Classic Plus pays 3% on the first £1,500 in your account, making it extremely competitive.
Unusually, you don't need to have any direct debits going out of the account if it is just the interest you want.
TSB are also currently offering a switch reward earning you 5% cashback a month on the first £100 of contactless payments. This includes Apple and Android Pay, up until 30 September 2017. Take advantage of this and you could earn up to £104 in a year. Usually reserved for ‘cash back credit cards’ this is a great way to spend and see some returns.
Nationwide FlexDirect Current Account
Nationwide Building Society is the second-most-switched-to bank at the moment.
With a simple set of overdraft fees Nationwide FlexDirect currently pays 5% AER fixed for a year on £2,500, which would give you a maximum £122.25 interest. This rate is fixed for the first year you hold the account, which gives some security in a world of uncertain savings rates. The rate falls to 1% (variable) in subsequent years.
To incur the interest, you'll need to pay in £1,000+ per month. So if you are after an account that pays you interest when you have money in your account, and if you prefer to do your banking online or over the phone, then this could be the current account for you.
Santander 1|2|3 Current Account
The Santander 1|2|3 offer 1.5% AER on your entire balance up to a limit of £20,000, making it a great choice for those with more significant savings.
You are also able to have two accounts in your name, but one must be joint which means couples can save £60,000 between them.
This account does have a £5/month fee which is automatically taken from the account each month but for most users that's more than covered by the 1-3% cashback this account gives on various types of utility bills paid by direct debit from the account. Cashback is paid directly in to your account.
The cashback you can receive on your household bills includes:
- 1% cashback on water and council tax bills and on your Santander monthly mortgage payments (up to a maximum of £1,000)
- 2% cashback on gas bills and electricity bills
- 3% cashback on mobile, home phone, broadband and paid-for TV packages
As an extra incentive, Santander offer a four month fee-free arranged overdraft when you switch.
Tesco Current Account
Tesco offer some great rewards with their current account, particularly if you regularly shop in their stores.
This is because your debit card also serves as your Tesco Clubcard and you earn one Clubcard point per £1 spent in Tesco on your debit card until 1 April 2019. You can also collect Clubcard points on fuel.
Overall this is a great account where you can earn some great rewards with the Clubcard scheme providing you take advantage of shopping in their stores. It’s also one of the few basic current accounts that do pay interest. The interest rate is high at 3.00% AER/2.96% Gross (variable) for balances up to £3,000.