Nationwide FlexAccount
Account Fee & RequirementsOverdraftHeadline Interest
No monthly fee18.9% EAR
(£15 buffer)
0% AER
Free Multi-trip European insurance cover, No monthly fee, Independently rated 5 star by Defaqto
Representative Example: If you use an overdraft limit of £1,200 the interest rate charged will be 18.9% EAR (variable).
 
TSB Classic Plus
Account Fee & RequirementsOverdraftHeadline Interest
No monthly fee
pay in £500+ a month
£25 (+ £10 buffer) interest
& fee free, then 19.94% EAR
5% AER
(£1 to £2,000)
To earn 5% AER you must credit your account with £500 each month, register for internet banking, paperless statements and correspondence (if available).
£25 interest and fee free overdraft subject to application and approval.
Representative Example: If you use an overdraft limit of £1,200 the interest rate charged will be 19.94% EAR (variable).
 
Clydesdale Bank Current Account Direct
Account Fee & RequirementsOverdraftHeadline Interest
No monthly fee
pay in £1,000+ a month
9.9% EAR
(£25 buffer)
2% AER
(£1 to £3,000)
Representative Example: If you use an overdraft limit of £1,200 the interest rate charged will be 9.9% EAR (variable).
 
NatWest Select Account
Account Fee & RequirementsOverdraftHeadline Interest
No monthly fee19.89% EAR + £6/month
(£10 buffer)
0% AER
Earn 1% cashback on contactless payments with Cashback Plus. Voted the best card benefits programme of the year at the Card and Payment Awards.
Representative Example: If you use an overdraft limit of £1,200 the interest rate charged will be 19.89% EAR (variable).
 
Tesco Bank Current Account
Account Fee & RequirementsOverdraftHeadline Interest
£5 a month18.9% EAR
3% AER
(£0.01 to £3,000)
Collect Extra Clubcard points in and out of Tesco with your debit card. One point for every £4 spent in Tesco and one point awarded for every £8 spent out of Tesco in each card purchase transaction. Exclusions apply.
Available in England, Wales and Scotland only. £5 monthly account fee - which you don't pay if you deposit £750 a month. Earn 3.00% AER/2.96% Gross variable credit interest on balances up to £3,000.
Representative Example: If you use an arranged overdraft limit of £1,200 at a rate of 18.90% EAR (variable) interest, you wuld be expected to pay £0.62 interest each day.
 
RBS Select Account
Account Fee & RequirementsOverdraftHeadline Interest
No monthly fee19.89% EAR + £6/month
(£10 buffer)
0% AER
Earn 1% cashback on contactless payments with Cashback Plus. Voted the best card benefits programme of the year at the Card and Payment Awards.
Representative Example: If you use an overdraft limit of £1,200 the interest rate charged will be 19.89% EAR (variable).
 
Nationwide FlexDirect => £1,000 per month
Account Fee & RequirementsOverdraftHeadline Interest
No monthly fee
pay in £1,000+ a month
£0.50/day
(£10 buffer)
5% AER
(£1 to £2,500)
Representative Example: If you use an overdraft limit of £1,200 the interest rate charged will be 0% EAR (variable).
 
Lloyds Bank Club Lloyds
Account Fee & RequirementsOverdraftHeadline Interest
No monthly fee
pay in £1,500+ a month
£100 interest
& fee free, then 19.94% EAR
4% AER
(£4,000 to £5,000)
As long as you pay £1,500 or more into your account each month, Lloyds will waive the £5 Club Lloyds monthly fee. If in any month you don't pay in this amount, you will need to pay the monthly fee.
Representative Example: Up to £100 interest and fee free overdraft, subject to application and approval. If you use a planned Overdraft of £1,200 on our Club LLoyds Account the overdraft Interest rate we charge on the first £100 will be 0% EAR (variable). The overdraft interest on the next £1,100 will be 19.94% EAR (variable) and a Monthly Overdraft Usage Fee of £6 will apply. You will not pay any fees or interest on an unplanned overdraft if you are overdrawn by £10 or less. EAR is the Equivalent Annual Rate. This is the actual annual rate of an overdraft. It doesn't take into account other fees and charges.
 
Halifax Current Account
Account Fee & RequirementsOverdraftHeadline Interest
No monthly fee£1-3/day
(£10 buffer)
0% AER
A standard current account that's exactly what you'd expect. It's an easy and convenient account for your day-to-day banking.
Add 'Control' to your account to help you prevent going into an unplanned overdraft (£10 monthly fee applies).
Representative Example: If you use a planned overdraft of £1,200, then you will be charged a daily fee of £1. Overdrafts are subject to status.
 
Santander Everyday Current Account
Account Fee & RequirementsOverdraftHeadline Interest
No monthly fee£1.00/day
(£12 buffer)
0% AER
Representative Example: 0% EAR (variable) Arranged Overdraft. No Daily Arranged Overdraft Fee for the first four months. Then £1 per day capped at 20 days each monthly statement period applies thereafter. Assumed Arranged Overdraft credit limit: £1,200. Actual amount may differ.
 
Halifax Reward Current Account
Account Fee & RequirementsOverdraftHeadline Interest
No monthly fee£1-3/day
(£50 buffer)
0% AER
Up to £160 cashback in the first year. Made up of £100 for switching an active bank account held elsewhere to Halifax and 12 monthly £5 reward payments.
Excludes customers who've already had £100 for switching to a Halifax bank account since January 2012. Switching to the Halifax is covered by the Current Account Switch Guarantee.
Representative Example: If you use a planned overdraft of £1,200, then you will be charged a daily fee of £1. Overdrafts are subject to status.
 
Santander 123 Current Account
Account Fee & RequirementsOverdraftHeadline Interest
£2 a month
pay in £500+ a month
£1.00/day
(£12 buffer)
3% AER
(£3,000 to £20,000)
Cashback and interest paid every month, every year. Independently rated 5 star by Defaqto and Best UK Bank by Euromoney
Representative Example: If you use an overdraft limit of £1,200 the interest rate charged will be 0% EAR (variable).
 
Ffrees Family Account
Account Fee & RequirementsOverdraftHeadline Interest
No monthly fee-0% AER
Have your wages, pension or benefits paid in for free. Includes 'cashback' style rewards with thousands of well known retailers.
No monthly fee, however, £2 a month If you do not use your Ffrees Account for two consecutive months.
 
Nationwide FlexPlus
Account Fee & RequirementsOverdraftHeadline Interest
£10 a month£100 interest
& fee free + £0.50/day
3% AER
(£1 to £2,500)
Representative Example: If you use an overdraft limit of £1,200 the interest rate charged will be 0% EAR (variable).
 
The Co-operative Bank Current Account Plus
Account Fee & RequirementsOverdraftHeadline Interest
No monthly fee
pay in £800+ a month
none0% AER
£100 cashback when you switch using The Co-operative Bank switching service and pay in £800 a month (they'll also donate £25 to charity). T&C's apply for the £100 offer. Visit providers website for full detials.
Representative Example: If you use an overdraft limit of £1,200 the interest rate charged will be 18.9% EAR (variable).
 
thinkmoney Personal Account
Account Fee & RequirementsOverdraftHeadline Interest
£14.50 a month-0% AER
With personal money manager service and day-to-day help getting the bills paid, so you know exactly what you can afford to spend
 
Secure Trust Bank Prepaid Bank Account
Account Fee & RequirementsOverdraftHeadline Interest
£12.50 a month-0.5% AER
No credit checks, No Hidden fees or charges, No charges for bounced Direct Debits or Standing Orders, earn up to 4% cash rewards.
 
eccount money Current Account
Account Fee & RequirementsOverdraftHeadline Interest
£12.50 a month-0% AER
Basic Bank Account open to everyone, regardless of Bad Credit. No Credit Checks or Hidden Charges with Guaranteed Acceptance.
 
TSB Classic Account
Account Fee & RequirementsOverdraftHeadline Interest
No monthly fee£25 interest
& fee free, then 19.94% EAR
+ £6/month
0% AER
Representative Example: If you use an overdraft limit of £1,200 the interest rate charged will be 19.94% EAR (variable).
 
Cashplus Cashplus Deluxe Account
Account Fee & RequirementsOverdraftHeadline Interest
£9.95 a month-0% AER
100% instant approval. No hidden or penalty charges. Add Creditbuilder to improve your credit rating
 

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Which Bank Pays the Best Interest Rates on Current Accounts

With the Bank of England base rate stuck at a record low, finding a decent rate of interest for your savings can be an uphill struggle.

Happy Older Couple Small

However, when it comes to getting the best interest rates on current accounts, it can be an even more tortuous search. But despite what it may feel like, there are a number of providers who still offer current accounts that pay interest.

We take a look at the best current account bank interest rates and what to look for to get a great deal.

Can I really get interest paid on my current account?

Although it might be surprising, current account interest rates compare very favourably to other types of account, including savings. Not every current account offers interest payments on credit balances but of those that do, many are very generous in comparison.

The highest interest rate on a current account may have conditions attached such as being able to pay in a minimum sum every month and paying out at least one or two direct debits. This type of qualifying criteria is typical for the best bank interest rates on current accounts but on the flip side, there's often an incentive offered too for switching from your existing provider.

The average interest rate on a current account varies hugely with most providers offering very little. However, if you compare your options and shop around it's certainly possible to get a good deal.

How to work out current account interest rates

Knowing how to get the best rate of interest on a current account isn't that much use if you don't actually understand what the figures mean. And with financial jargon often harder to understand than a foreign language, it can be almost impossible to work out how much interest you will actually receive.

For most bank accounts interest is normally paid on cleared balances only; credits which are waiting to be processed won't count towards an interest payment. Many banks calculate this at the end of each working day and will deduct income tax from the gross figure.

Therefore, if you want to know how much interest you will be paid, you just need to know the rate paid by your bank. Take the interest rate (5% for example) then divide this figure by 365; this will give you the daily interest rate. Multiply this figure by your cleared balance at the end of the day and the figure will show you how much interest you earned on that one day. Repeat the process for all the days you want to calculate interest for. Don't forget to deduct tax from this figure unless you receive your interest payments gross.

Once you know how to calculate the interest payable, you have more scope to compare current account interest rates as you will be able to determine the difference that varying rates will have on your balance.

What to look for when carrying out a best current account interest rate comparison

The bank account with the highest interest rate will of course be the one you are immediately drawn to but it's worth checking the fine print to see if the deal is quite as competitive as you think.

The best interest rate accounts not only typically have qualifying criteria, they also frequently carry penalties if you fail to meet them one month. This can wipe out any interest you earn so if you do sign up, make sure you set yourself reminders to check. And many of the accounts may also be fee-based to remember to factor this into your calculations when you compare bank account interest rates.

Other considerations include checking what balance the highest rate of interest applies to; you may find that once you have accumulated a certain amount, interest payments dwindle to as low as 0.1%. Likewise, the headline interest rate may only be payable for an introductory period; check to see what it reverts to once this has passed as it may not be worth making the switch.

It's also worth considering other priorities as well as the online bank account rate of interest. For instance, whether there is a banking app, if there's a branch near you and, if you go into your overdraft on the odd occasion, whether the rates are favourable. Ultimately a high rate of interest on an overdraft could cost you more than you'd earn in interest so make sure you check this just in case!

Current Account Comparison