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Best bank accounts

Best bank accounts

Get up to £170 to switch, up to 3% back on bills or up to 5% interest

Martin Lewis
Martin Lewis
Updated 1 July 2022

If you're unhappy with your bank, switching is quick and easy – and now's a great time to do it as four banks currently pay for your custom with up to £170 cash. Yet you don't need to switch to get a good deal – other accounts give cashback on bills or pay savings interest. This guide explains it all and helps you compare the top-pick accounts.

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In this guide

Top-pick bank accounts

Other top MSE banking guides...
Packaged accounts: Save £100s on insurance
Need a business bank account?: For the self-employed
Basic bank accounts: For those with poor credit histories
Digital banking: Learn about app-based banks

What is a current account?

A current account is a type of bank account that keeps your money secure and helps you manage your finances. They give you an easy way to make payments to others (for example, standing orders and direct debits) and let people pay you (for example, your employer). You'll also get a debit card, which allows you to make payments and withdraw cash from a cash machine.

While you may use other money products, such as credit cards or savings accounts, it’s generally your current account that lets you make payments into each one, or pay bills, meaning everything works smoothly together.

Is my money safe?

Your money is secure – the Financial Service Compensation Scheme guarantees up to £85,000 per person, per financial institution. This means that if your bank ever went bust, you would be guaranteed your money back (up to £85,000).

How do I open a current account?

Opening a current account is an easy process. The simplest way is to complete an application form online, though many banks do allow you to open an account in person or over the phone if you prefer. The application form will ask you a number of questions regarding your personal and financial circumstances, and usually takes around 10 minutes to complete. Sometimes there could be extra steps – such as supplying ID or payslips – although this is rare.

You will also need to agree to the bank credit-checking you when you apply, regardless of whether or not you request an overdraft. This is because most banks use information from the credit reference agencies to confirm that you are who you say you are. This may seem unnecessary, but banks are legally bound to ensure they do not facilitate money laundering, and establishing a customer's true identity helps them to do that.

The five bank account need-to-knows

There are a few points you need to think about when choosing a new bank account to ensure you make the right selection:

  • 1. Switching is easy and takes just seven working days

    The Current Account Switch Service (CASS) process is straightforward and takes just seven working days. Just open a new account with your chosen bank, then request a switch through it – you'll usually be asked during the application if you want to switch. Provided both banks are signed up to CASS (most are), the switching service will close your old account and move your money, direct debits and standing orders across.

    It'll also move payments meant to go into your old account into the new one, for instance, your salary. If something goes wrong, the bots behind the scenes sort it, so for at least three years any money paid into the old account or wrongly earmarked to come out of that account is transferred to the new one. Also, if you're hit with any charges due to an error in the switch, this should be refunded by the new bank.

    Quick questions

    • Are recurring payments from my card also moved?

      No. Otherwise known as continuous payment authorities, these are set up using your debit or credit card details, as opposed to your account number and sort code. They're often used for memberships, online subscriptions and payday loan repayments. The company will ask for the long number across your card, giving it permission to take cash from your account.

      If you switch, you need to give your new card details to any companies that take money from your card in this way.

    • Some banks require you to switch 'active' direct debits. What does this mean?

      An active direct debit is one that has paid out in the last 13 months or – if it has never paid out – is less than 13 months old.

      Direct debits have this dormancy rule in place, so old direct debits can remain active even if you're not paying out on them every month in case they're needed again, or they're there for annual payments. But after 13 months, your bank may remove them from your account or mark them as inactive.

    • Do I HAVE to close my old account when switching?

      Yes, if you switch via CASS (which you usually need to do in order to get any switching incentives). As part of the process, your new bank will automatically close it and also move all payments, for example, direct debits out or salary in, across.

      But if you'd rather keep your old account open, or your old or new bank is one of the few not signed up to CASS, you'll need to use the older, slower and more complicated system. Your payments will still be switched over, but there's less protection if anything goes wrong and it's likely you won't get any of the switch incentives.

    • Can I switch a sole account to a joint account and vice versa?

      If you want to join finances with a partner, it's possible to use seven-day switching to switch a sole account to a joint account. Do remember that this'll link your finances, so their credit record could affect yours – always think carefully before doing so.

      This doesn't work the other way round, so you can't switch a joint account to a sole account under seven-day switching.

    • I have other products such as an ISA and credit card with my bank – what will happen to them if I switch away?

      Most other products that you hold are totally separate, so moving your current account won't affect the others and it's fine to do. In fact, even if you have a direct debit set up to pay them, that'll automatically be moved to your new bank account for you, so it shouldn't put you off switching at all.

      There are a few special regular savings accounts that are linked to current accounts (where you get a special rate if you've got the current account) that you could lose if you move bank, but you'll know if you've got one of those and your new bank may offer something similar.

    • Can I switch my savings account too?

      Unlike with current accounts, there's no switching service for savings accounts. Yet it's easy to move your savings – simply open the new savings account and then transfer your money across.

      We're currently in an era of fierce competition when it comes to interest rates on savings, with the top rates changing frequently. See Top savings for full info.

    • Which banks and building societies are signed up to CASS?
      More than 40 providers are signed up to the Current Account Switch Service (CASS):
       
      • Acorn Account
      • Adam & Company
      • AIB (NI)
      • Allied Irish Bank (GB)
      • Arbuthnot Latham & Co.
      • Bank of Ireland UK
      • Bank of Scotland
      • Barclays
      • Barclays Private
      • C. Hoare & Co.
      • CardOneMoney
      • Clydesdale Bank
      • Co-operative Bank
      • Coutts
      • Coventry Building Society
      • Cumberland Building Society
      • Danske Bank
      • First Direct
      • Habib Bank Zurich
      • Halifax
      • Hampden & Co
      • Handelsbanken
      • HSBC
      • HSBC Private Bank
      • Investec Bank
      • Isle of Man Bank
      • Lloyds Bank
      • Lloyds International
      • Lloyds Private Bank
      • M&S Bank
      • Metro Bank
      • Monzo
      • Nationwide Building Society
      • NatWest
      • NatWest International
      • Reliance Bank
      • Royal Bank of Scotland
      • Santander
      • smile
      • Starling Bank
      • Tesco Bank
      • thinkmoney
      • Triodos Bank
      • TSB Bank
      • Ulster Bank
      • Unity Trust Bank
      • Virgin Money
      • Weatherbys Bank
      • Yorkshire Bank

      Last updated March 2021.

  • 2. Many accounts have minimum pay-in requirements – but you can get around them

    With most of the top accounts in this guide, you'll need to pay in a certain amount each month in order to qualify, get the perks and/or avoid a fee. But if you can't afford the minimum, don't fret – there's a way to play the system.

    Say you need a minimum £1,000, but only have £500 coming in. If you pay £500 in, withdraw it or move it to another bank, then pay it back in... BINGO, that's your £1,000.

    Note: We've had reports some banks may not accept you when you apply if your income's not high enough to meet the minimum monthly pay-in. 

    These are the minimum pay-ins for bank accounts we mention in this guide, plus details of what happens if you miss that minimum payment:

    Top bank accounts ranked by minimum pay-in

    Account Min monthly pay-in Equivalent salary/year needed (1) What if I don't pay in this much?
    Virgin Money current account None N/A N/A
    HSBC Advance None N/A N/A
    First Direct 1st Account None (2) N/A N/A
    Nationwide FlexPlus None N/A N/A
    Santander 123 Lite £500 £6,000 No cashback paid
    Barclays Blue Rewards £800 £9,700 No rewards earned
    Co-op Bank Everyday Rewards £800 £9,700 No rewards earned
    Bank of Scotland Vantage £1,000 £12,400 No interest paid
    Nationwide FlexDirect £1,000 £12,400 No interest paid
    NatWest Reward £1,250 £16,700 Transferred to NatWest Select account
    RBS Reward £1,250 £16,700 Transferred to RBS Select account
    Club Lloyds £1,500 £21,200 £3/month fee
    Halifax Reward £1,500 £21,200 £3/month fee and no reward that month

    (1) This is an estimate and will be higher if you have anything taken out of your pay like pension or student loan contributions. (2) No monthly min but must pay in £1,000+ once to get switching bonus.

  • 3. If you're often overdrawn, focus on the account with the cheapest overdraft, not other benefits

    Almost all major banks now charge about 40% interest for overdrafts: double what it costs to borrow on a high street credit card. But a few banks charge less, and some even offer 0% overdrafts – so if you're in the red, have a look at the top overdrafts section below for the cheapest options.

    It's worth noting that you CAN still switch if you're overdrawn – but it's tricky as it depends on the new provider's lending procedure. For example, it could decide not to offer you an overdraft, or could offer you a lower limit. Yet don't let that put you off trying – many banks have eligibility checkers so you can see if you're likely to get the overdraft before applying.

    For more help if you're struggling with your overdraft, see our full Cut overdraft charges guide.

  • 4. All the top bank accounts require you to pass a not-too-harsh credit check

    Banks will use this credit check, plus data on your application form, to decide whether to accept or reject you for the account you applied for.

    If you're rejected, it could be for one of many reasons, for example... you've got a poor credit record, you've had past dealings with that bank where you've missed payments or the bank doesn't think you'll be a profitable customer.

    But don't assume because one bank doesn't want you, none of the others will. All the same, don't just apply everywhere as it can do more damage to your credit record.

    Instead, you need to do two things – first, ask the bank why it rejected you. Its answer may be vague, but it should tell you if you were rejected because of your credit record.

    Then, check your credit files with the three credit reference agencies to spot any problems or possible errors. Our Credit report guide tells you how to do this for free and how to correct errors.

    Can't get a standard bank account? Try a basic one

    Sadly, as many as one million people in the UK are rejected from mainstream bank accounts, often due to past credit problems. Yet as long as you can prove your identity and address, you should be able to get a basic account – here, you're not credit-checked as strictly, so most can get one.

    You can do most of the same things as with a normal bank account, except you won't get an overdraft. Read full help and tips in our Basic bank accounts guide.

  • 5. You could save £100s on travel, mobile & breakdown insurance with a packaged account

    Packaged accounts can be great, saving some £100s a year, as for a monthly fee you get a host of insurance policies – typically travel, breakdown and mobile phone insurance.

    But they can also be worthless if you don't need the cover or you could have got it cheaper elsewhere, so check first.

    For more help on whether this type of account is right for you, see our Best packaged accounts guide.

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Top bank accounts with free sign-up cash for switching

Four banks currently offer switch bonuses – three pay straight cash bribes, and one gives points you can spend on a variety of experiences, flights and gifts. Unusually, one is available to existing customers. But read carefully – you need to hit certain conditions to get the bonuses.

Top bank accounts for new switchers

Newbies who switch to the HSBC Advance* account get £170 free cash. There's no minimum monthly pay-in to keep the account, though you will need to deposit £1,500+ once to get the bonus.

 

Who can get the bonus? You can't have had an HSBC current account, or opened one with its sister bank First Direct, since January 2019. You must be switching from a current account that's not with HSBC or First Direct.


 

HSBC Advance*

 

Service rating: 38% 'great' 

How to get the bonus: 
Open an account and start a switch within 30 days (including 2+ direct debits or standing orders) and pay in £1,500+ in the first 60 days. The £170 is then paid within 30 days.

 

Account info:

- Minimum pay-in: None

- Arranged overdrafts: 39.9% EAR variable (first £25 interest-free)

- Unarranged overdrafts: 39.9% EAR variable (max £20/month)

 

Switch to the First Direct 1st Account* and bag a FREE £150, or get £20 just for opening it. If you're after a bank with cracking service, 90% rated First Direct 'great' in our last poll – the best rating of all banks. Many also get an ongoing £250 0% overdraft, plus access to a linked regular saver which pays 3.5% interest on up to £300/month.

 

Who can get the bonus? You can't have ever had any First Direct account before, or opened a current account with its sister bank HSBC since January 2019. You must be switching from a current account that's not with First Direct or HSBC.

 

First Direct 1st Account*

 

Service rating: 90% 'great' 

How to get the £20 bonus: 
Open an account and use mobile or online banking within three months. The £20 is then paid within the first four months.

 

How to get the £150 bonus: 
Open an account then, within three months, complete a switch from another current account (can't be HSBC or First Direct) and pay in £1,000+. The £150 is then paid within 28 days. You can either request the switch online when applying or later by calling it.

 

Account info:

- Minimum pay-in: None

- Arranged overdrafts up to £250: 0% EAR variable

- Arranged overdrafts over £250: 39.9% EAR variable

- Unarranged overdrafts: 39.9% EAR variable (max £20/month)

 

Existing customers who switch to the Nationwide FlexDirect account get £125, newbies get £100 (though we've an easy trick for all to get the boosted £125 – the link has full details). In addition to the free cash, you get 5% fixed interest on up to £1,500 and many get a 0% overdraft – both last for the first 12 months, unless you've had this account before, in which case you'll get just 0.25% in-credit interest and no 0% overdraft.
 

Who can get the bonus? You can't have had this switch bonus before and you must be switching from a non-Nationwide current account. If you've an existing account, it can't be in debt collection or frozen.

 

Nationwide FlexDirect

Service rating: 70% 'great'

 

How to get the bonus:

Switch to a new or existing account, including 2+ direct debits, with a switch completion date within 30 days. Once complete, the bonus is paid within 10 days.

 

Account info: 

- Minimum pay-in: None (£1,000/month to get the interest)

- Interest: 5% AER fixed (year one), 0.25% AER variable (years two+)

- Arranged overdrafts (year one): 0% EAR variable
- Arranged overdrafts (years two+): 39.9% EAR variable

- Unarranged overdrafts: Not available

 

Newbies switching to the Virgin Money M Plus* account get 20,000 Virgin Red points to spend on a variety of experiences, gifts or flights. For example, a 12-bottle case of wine is 19,000 points (please be Drinkaware), afternoon tea for two is 6,250 and two tickets to a comedy night are 4,000. It's also a good account for travel as there are no fees on overseas spending or ATM withdrawals.

 

Who can get the bonus? You can't have a Virgin Money current account (or have closed one since 31 January 2022) and can't have ever had a Virgin Money current account switch bonus. You must be switching from a non-Virgin Money current account.

 

Virgin Money M Plus*

 

Service rating: 45% 'great'

 

How to get the bonus:

Open an account online, then within 45 days: switch, pay in £1,000+ to its M Plus Saver account (1.56% AER variable), use the mobile app and have two direct debits. Once done, a code to redeem your Virgin points is sent within 14 days – you can then withdraw the £1,000+ if you wish.

 

Account info:

- Minimum pay-in: None

- Interest: 2.02% AER variable 

- Arranged overdrafts: 19.9%, 29.9% or 39.9% EAR variable

- Unarranged overdrafts: 19.9%, 29.9% or 39.9% EAR variable, plus a £4 unpaid transaction fee (max £40/month)

 

All have Financial Services Compensation Scheme savings protection of up to £85,000 (HSBC's is shared with First Direct and Virgin Money's is shared with Clydesdale Bank and Yorkshire Bank).

Top bank accounts for longer-term rewards

Some accounts give free cash as a percentage of what you spend on bills, or pay you cashback when you spend, pay out direct debits or use digital banking. However, many come with a fee, so work out whether the cashback will outweigh this.

Top bank accounts for cashback

Get 1-3% cashback on most bills for a £2/month fee. With the Santander 123 Lite* you get back 3% on water; 2% on energy; and 1% on Santander mortgages, council tax, mobile, phone, broadband and paid-for TV – provided you pay by direct debit. You can get up to £5/month in each tier – so £15/month max. To get the cashback, you need to pay in £500+/month, have two+ direct debits, use digital banking at least once every three months and pay the fee.


 

Santander 123 Lite*

 

Service rating: 59% 'great'

Account info:

- Minimum pay-in: £500/month

- Arranged overdrafts: 39.94% EAR variable

- Unarranged overdrafts: 0%

 
1% cashback on most purchases for a year, no fees to spend/withdraw cash abroad, plus 1.5% interest on up to £250,000 via its linked easy-access savings account. The app-only Chase current account* gives a top rate of cashback on most spending, though you'll need to activate it in the app first. You can also use a feature to round up all your purchases to the nearest £1 and autosave the difference into a separate account paying 5% (so, spend £1.45 and 55p is transferred). However, it moves the balance to another account (of your choice) each year, so the 'round ups' start from scratch.

 

Chase current account*

 

 

Account info:

- No minimum pay-in

- 1% cashback on most purchases for the first 12 months

- 1.5% AER variable interest on up to £250,000

- 5% AER variable interest via its 'round-up' feature

- Can't be opened as a joint account

- Overdrafts aren't available
- To get the app, you'll need an Apple iPhone or iPod touch running iOS 14.1 (or later) or a device running Android 8.1 (or later)

 
Next best accounts that offer cashback

Halifax Reward

 

Service rating: '58% great'

Get £5/month when you:
Pay in £1,500+/month (it's a £3/month fee if you don't), stay in credit and either a) spend £500+/month on your debit card OR b) keep a constant £5,000+ in your account each month (no interest is paid). You'll need to choose which one you'll meet for the next year.

 

NatWest Reward*

 

Service rating: 53% 'great'

 

RBS Reward

 

Service rating: 64% 'great'

 

Get up to £3/month when you:

Pay in £1,250+, pay out 2+ direct debits of £2+ and log in to its mobile app each month. You get £5/month back, but there's a £2/month fee.

All have Financial Services Compensation Scheme savings protection of up to £85,000 (Santander's is shared with Cahoot, Chase's is shared with JP Morgan, and NatWest's is shared with Ulster Bank).

Top bank accounts that pay savings interest

None of the accounts below requires you to switch to get the interest, though Virgin and Nationwide currently have switch bonuses available. For comparison, the top easy-access savings deal open to all pays about 1.35%. 

Top bank accounts for interest

Get 1.5% interest on up to £250,000 with Chase's linked easy-access savings account. Open a Chase current account* using its app first, then open the savings account from within the app. The current account gives 1% cashback on most purchases for a year, fee-free spending and withdrawals abroad, and 5% interest on small amounts via its 'round-up' feature – though it moves the 'round up' balance to another account (of your choice) each year, so the 'round ups' start from scratch.

 

Chase current account*

Account info:

- 1.5% AER variable interest on up to £250,000 on the linked easy-access savings account

- 5% AER variable interest via its 'round-up' feature

- 1% cashback on most purchases for the first 12 months

- Can't be opened as a joint account

- Overdrafts aren't available
- To get the app, you'll need an Apple iPhone or iPod touch running iOS 14.1 (or later) or a device running Android 8.1 (or later)

 

Get 1.56% interest on up to £25,000 with Virgin's linked easy-access savings account, plus the current account pays 2.02% interest on up £1,000. You can get slightly higher rates with the Virgin Money M Plus* current account and M Plus Saver (opened automatically) than with Chase's account above, though its credit check goes on your credit file (best not to apply if you've important credit applications soon). There's no minimum pay-in for either account, and the debit card is great for travel as it offers fee-free spending and cash withdrawals overseas.

Plus, newbies who switch can get 20,000 Virgin Red points to spend on a variety of experiences or gifts.



Virgin Money M Plus*

Service rating: 45% 'great' 

Account info: 

- 2.02% AER variable interest on up to £1,000

- 1.56% AER variable interest on up to £25,000 on the linked easy-access savings account

- Can open a sole and joint account to max interest

- Arranged overdrafts: 19.9%, 29.9% or 39.9% EAR variable

- Unarranged overdrafts: As above, plus a £4 fee (max £40/month)

New. Get 5% fixed interest on £1,500 for a year – worth up to £75. The Nationwide FlexDirect pays a whopping 5% in-credit interest, so easily beats the above accounts if you've £1,500 or less to save. However, the rate drops sharply after a year, so look elsewhere then as it's likely it can be beaten. Though note the 5% in-credit interest is only for FlexDirect newbies – if you've had this account before you'll get just 0.25%. As with Virgin above, its credit check will go on your credit file, so best not to apply if you've important credit applications soon. 

 

Plus, new or existing customers who switch can get up to £125 in free cash.



 

Nationwide FlexDirect

Service rating: 70% 'great'

Account info:

- Interest: 5% AER fixed (year one), 0.25% AER variable (years two+)

- Minimum monthly pay-in: £1,000+/month

- Can open a sole and joint account to max interest

- Arranged overdrafts (year one): 0% EAR variable
- Arranged overdrafts (year two+): 39.9% EAR variable

- Unarranged overdrafts: Not available

 

All have Financial Services Compensation Scheme savings protection of up to £85,000 (Chase's is shared with JP Morgan, and Virgin Money's is shared with Clydesdale Bank and Yorkshire Bank).

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Top accounts if you're overdrawn

Overdrafts are debts – one of the most expensive. However, during the coronavirus crisis, all banks need to help those who are struggling with overdraft interest by offering tailored support. This could include reducing or waiving overdraft interest, transferring the overdraft debt to a cheaper credit product (for example, a personal loan), or reducing the overdraft limit in stages as you pay the balance off. Full info in coronavirus help.

Don't just tackle the symptoms of your overdraft, though – it's important to try and pay it off. See our full Cut overdraft costs guide for help with this.

These accounts could help you cut costs over the long term, though do remember that you're not guaranteed to get an overdraft when you apply. We've included info on how to find banks' overdraft eligibility checkers, which should help you find out if it's likely before you apply.

Top bank accounts with low-cost overdrafts

First Direct's 1st Account* offers many a £250 0% overdraft, plus GREAT service. Though the overdraft isn't guaranteed – use its eligibility checker before applying (click the "overdraft" text in the first bullet, the checker's in the "overdraft overview" box). Expensive interest kicks in above that, so it's best if you only use your overdraft for limited amounts.

 

Plus, new customers can get £20 just by opening the account (or £150 by switching).

First Direct 1st Account*


Service rating: '90% great'

Overdraft info:

- Arranged overdrafts: 0% up to £250, then 39.9% EAR variable

- Unarranged overdrafts: 39.9% EAR variable (max £20/month)

 

Newbies to the Nationwide FlexDirect get a 0% overdraft for a year. The overdraft limit you get (up to £2,750) depends on your credit score – use Nationwide's eligibility checker before applying (scroll down past the purple box about the app to the overdraft section, then click the third link for the overdraft eligibility tool). After a year you'll start paying a hefty rate of interest, so clear as much of your debt as you can by then. Though note only FlexDirect newbies qualify for the 0% overdraft.

 

Plus, new or existing customers who switch can get up to £125 in free cash.




Nationwide FlexDirect

 

Service rating: 70% 'great'

Overdraft info:

- Arranged overdrafts (year one): 0% EAR variable
- Arranged overdrafts (year two+): 39.9% EAR variable

- Unarranged overdrafts: Not available

 
Starling Bank* has an overdraft with a lowish rate and no fees for exceeding your limit. While the app-based bank doesn't offer a 0% overdraft, its rates are lower than most. Plus, you can control your overdraft limit in its app, and set up spending notifications if you're about to go into (or are already in) your overdraft. The rate and limit you get depends on your credit score – use its eligibility checker before applying (it's hard to find, so we've included a link here).


 

Starling Bank*

 

Service rating: 90% 'great'

Overdraft info:

- Arranged overdrafts: 15%, 25% or 35% EAR variable
- Unarranged overdrafts: 15%, 25% or 35% EAR variable

 

 

All have Financial Services Compensation Scheme savings protection of up to £85,000 (First Direct's is shared with HSBC).

Top bank account for insurance

Below is our top-pick packaged bank account which, for a monthly fee, offers various insurance perks. Always check if it's cheaper to buy the insurance elsewhere before applying, and for more options see Packaged bank accounts.

Top packaged bank account with insurance

Get £500+/year of travel, mobile & breakdown cover for £156/year with the Nationwide FlexPlus. It has the lowest fee of our top-pick packaged accounts at £13/month, and is especially good for families as you get cover for all the family's mobiles and worldwide family travel insurance (£65/year extra if you're 70+). You also get UK & European breakdown cover for account holders. See full 'what the insurance covers' info.

 

Plus, new or existing customers who switch can get up to £125 in free cash.

 

Nationwide FlexPlus

 

Service rating: 70% 'great'

Account info:
- £13 monthly account fee (£156/year)
- No minimum monthly pay-in
- Arranged overdrafts: 39.9% EAR variable

- Unarranged overdrafts: Not available
- Financial Services Compensation Scheme savings protection: up to £85,000

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Cashback sites may pay you for signing up

As an extra boon, members of specialist cashback websites can be paid when they sign up to some financial products. Do check that it's exactly the same deal though, as terms can be different. And remember the cashback is never 100% guaranteed until it's in your account.

Full help to take advantage of this and pros and cons are in our Top cashback sites guide.

Want to complain about your bank account?

If your bank has charged you the wrong amount, taken the wrong amount in payment or its service has been atrocious, then you don't have to suffer in silence.

It's always worth trying to call the bank first to see if it can help, but if not, you can use free complaints tool Resolver. The tool helps you manage your complaint, and if the company doesn't play ball, it also helps you escalate your complaint to the free Financial Ombudsman Service.

Bank account FAQs

Here are some common bank account related queries. If you've got a question we've not answered below or in the text above, suggest a question in the MSE Forum.

  • What do I do if I've sent money to the wrong account?

    When sending money to a different account, many banks now use the Confirmation of Payee scheme, which checks whether the name of the account you are sending money to matches up to the sort code and account number you type in. If the name doesn't match, the bank will let you know so you can amend any errors before making the payment.

    If your bank isn't signed up, it'll be using the old system, where the only information it'll use is the sort code and account number, meaning if these details are wrongly entered the cash could end up in a stranger's bank account.

    If you end up sending money to the wrong account, here's what you need to do and what happens then:

    • Contact your bank straightaway to let it know about the mistake. While banks can't stop payments that have already been made, contacting it as soon as possible will help speed up the process of sorting it out. It's a good idea to keep a note of all correspondence you have with the bank and also to make a note of exactly when the error was made. If you know the mistake you made (for example, you used the wrong sort code), then make a note of that too.

    • Your bank will act within two working days of you telling it. And it doesn't matter if you discovered your mistake after a week or even a year... though it's good financial sense to keep an eye on your account(s) to make sure your payments have reached the right recipient.

    • As long as there are no disputes, your money will be returned within 20 working days. Where there's clear evidence of a genuine mistake, your bank will contact the receiving bank on your behalf requesting that the money isn't mistakenly spent by the person who accidentally received it, and you'll get your money back.

    If there are issues, for instance if the person you accidentally sent it to refuses to return it, you'll be notified of the outcome of the bank's investigation within 20 working days from the point that you let it know.

  • How does it work with reward payments and tax?

    As well as offering in-credit interest or bonuses for switching, some current accounts now pay rewards for holding the account and meeting certain criteria, such as paying in a set amount each month or having direct debits.

    A few of these, such as the Halifax Reward Account and Co-op Bank's Everyday Rewards scheme, are paid with basic-rate tax already deducted. Others, including Barclays Blue Rewards, are paid without any tax removed.

    These payments don't count as savings income for tax purposes and instead are classed as 'annual' or 'miscellaneous' payments. This means that the rewards don't count towards your personal savings allowance, and they're liable to be taxed.

    If you're a non-taxpayer, you should claim back any tax taken using the R40 form. Higher and additional-rate taxpayers may need to pay more via tax returns.

  • Is there a way to track down old bank accounts?

    In the UK, old, now-dormant accounts hold millions of pounds that lay unclaimed – and if you've switched several times, you may still have old accounts that were never closed.

    It's straightforward to get it back – we've full details in the Reclaim forgotten cash guide.

  • What's the difference between a direct debit, standing order and recurring payment?

    A direct debit is where you give permission to a company to take money from your bank account, and the amount can vary depending on what you're paying for. You have very little control over how much money is taken, though the company you're paying will tend to send you a statement informing you of how much will be taken and when. And the direct debit guarantee means you're entitled to a refund if there are any errors in the payment.

    A standing order is an instruction from you, to your bank, to pay a fixed amount of money to an account. You can send a standing order to any account, bill, mortgage payment or organisation. You have full control over how much and how frequent the payments should be, as you set them up yourself.

    A recurring payment (or continuous payment authority – CPA) is where you give a company your card details, and they use them to set up a regular or continuous payment from your card. You'll know if it's a recurring payment if you give the company your 16-digit card number, rather than your bank account number and sort code.

    They're usually used if you're paying for a subscription, like a TV streaming service or recipe box. With these payments you have very little control over how much or when they'll take out your money, and you usually won't be informed that the company will be taking a payment.

    However, you can ask your bank to cancel them, as well as asking the retailer if you want to end the service. See Recurring payments.

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