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Best Bank Accounts

Free £175 cash & more to switch

top bank accounts
Martin Lewis
Martin Lewis
Updated Weekly

If you're unhappy with your bank account, don't just groan. Switching away is easy – and you can get up to £175 in cash or £180 in vouchers to switch and stay as banks lust for your custom. This guide explains it all and compares the best buys for you. 

Best bank accounts

In this guide

Other top MSE banking guides...
Packaged accounts: save £100s on travel, mobile and breakdown insurance
App-based banking: learn about the new wave of digital banks
Student accounts: get 0% overdrafts or other perks if you're studying
Graduate accounts: for when you've left university
Safe savings: find out how your money is protected

How does bank switching work?

The process is quick and easy since the seven-working-day Current Account Switch Service (CASS) began in September 2013. Just open a new account, then use the new bank's switching service and it'll close your old account and move your money, direct debits, standing orders etc across.

It'll also move payments meant to go into your old account into the new one, eg, 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.

  • More than 40 providers are signed up to CASS

    • Acorn Account
    • Adam & Company
    • Allied Irish Bank
    • 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
    • First Trust Bank
    • Habib Bank Zurich
    • Halifax
    • Hampden & Co
    • Handelsbanken
    • HSBC
    • HSBC Private Bank
    • Investec Bank
    • Isle of Man Bank
    • Lloyds
    • Lloyds International
    • Lloyds Private Bank
    • M&S Bank
    • Metro Bank
    • Monzo
    • Nationwide Building Society
    • NatWest / NatWest International
    • Post Office
    • Reliance Bank
    • RBS
    • Santander
    • Smile
    • Starling Bank
    • Tesco Bank
    • Thinkmoney
    • Triodos Bank
    • TSB
    • Ulster Bank
    • Virgin Money
    • Weatherbys Bank
    • Yorkshire Bank

    Last updated July 2019.

Rather watch than read?

This helpful little video gives you the bank switching lowdown...

Embedded YouTube Video

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 switching bonuses or perks require '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 the seven-working-day Current Account Switch Service (CASS). As part of the process, your new bank will automatically close it and also move all payments, eg, 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 it's likely the new bank will offer something similar.

Seven tips to find your best account

Not every bank account is right for you, so use these tips to nail YOUR best.

  • 1. How to get around banks' minimum pay-in requirements to get the perks

    If you can't afford some banks' minimum monthly pay-ins, don't fret. Some, such as M&S Bank, give you a switching bonus without paying anything in – though you won't get their ongoing rewards.

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

    Note: we've had reports some may not accept you if your income's not high enough to meet the pay-in.

    • See a full list of accounts ranked by minimum pay-in

      Top bank accounts (ranked by initial min pay-in)

      Account Minimum pay-in/mth Equivalent salary/yr needed (1) What if I don't pay in this much?
      M&S Bank None for £100 initial bonus, £1,250 for a year for further £80 £17,000 £80 gift card not paid
      Santander £500 £6,000 No interest paid
      Tesco Bank £750 £9,500 No interest paid
      Barclays £800 £10,000 No rewards earned
      Bank of Scotland £1,000 £12,500 No interest paid
      First Direct £1,000 £12,500 £10/mth fee
      Nationwide FlexDirect £1,000 £12,500 No interest paid
      Club Lloyds £1,500 £21,500 £3/mth fee
      NatWest £1,500 £21,500 No cashback
      HSBC £1,750 £26,000 Transferred to HSBC's Bank Account

      (1) This is an estimate and will be higher if you have anything taken out of your pay like pension or student loan contributions.

    • What counts as a month to meet the minimum pay-in amounts?

      The answer to this isn't as straightforward as you might think, as what counts as a month depends on which bank you're with.

      For example, if you bank with Santander, a month counts from the anniversary of the date that you opened the account. In contrast, bank with Lloyds and it simply follows the calendar month. It's important to clarify this with your bank to make sure you don't get penalised for missing minimum monthly pay-ins, especially if your pay is erratic.

      See our table below for the policies of the major UK banks:

      LENDER WHAT COUNTS AS A MONTH?
      Bank of Scotland Calendar month
      Barclays Calendar month
      Co-op Bank Calendar month
      First Direct Calendar month
      Halifax Calendar month
      Lloyds Calendar month
      M&S Bank Calendar month
      Nationwide Calendar month
      NatWest/RBS Calendar month
      Santander Statement month
      Tesco Bank Statement month
      TSB Calendar month
      Last updated October 2018.
    • Why do banks have a minimum pay-in?

      It's essentially just a way to ensure you use their account as your main account.

  • 2. Which pays more? Free intro cash bonuses or savings interest?

    We used to say if you have savings, an interest-paying account would win. But with several banks cutting high rates in recent years, accounts paying cash or vouchers are now the best option for most.

    Even high interest accounts only pay that return on smaller sums. See our Top Savings Account guide for where to earn the best savings return.

    Quick questions

    • Can I switch loads to bag lots of intro bonuses?

      Yes, though as you can usually only get the incentive once from each bank, at some point you will run out. However, bear in mind that to earn more than a £100 switching bonus in bank savings you would need £2,000+ (at current rates). So, it depends on whether you have this to save.

      One other thing to consider: continually switching accounts has a negative impact on your credit score. Lenders like to see stability in your accounts, and this doesn't demonstrate it.

    • Where could I save otherwise?

      The top easy-access savings account pays 1.5% AER, so you can earn that without switching bank. So if bank savings pay, for example, 3%, then the gain from choosing it as your bank is 1.5%.

      But to counter this, the easy-access savings accounts tend to have high limits on the amount you can save in them – often £100,000s or £1,000,000s – whereas the most you can save and still get interest in a bank account is £20,000.

    • Do you pay tax on savings interest?

      Since 6 April 2016, most people won't pay tax on savings interest as the personal savings allowance has kicked in.

      Basic-rate taxpayers can earn up to £1,000 in savings interest (including that which is earned in current accounts) before paying tax on it, easily covering the maximum interest on the accounts in this guide. For higher-rate taxpayers it's £500, which will cover all accounts in this guide. Additional-rate taxpayers don't get an allowance.

      Bonus payments are tax-free whatever rate of tax you pay. If you've used your personal savings allowance on other savings, or you don't get one, it's likely switching bribes will win for you.

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

    Overdraft charges overhaul. From 6 April 2020, banks will no longer be able to charge you extra for busting your overdraft limit, and will have to charge a single interest rate instead of fixed daily or monthly fees. For more, see our overdrafts news story.

    There are huge differences in the amounts banks charge for going overdrawn. We identify the cheapest in our top overdraft section.

    If you are in the red, it's worth trying to get out of the mire by seeing if you can cut outgoings by doing a money makeover, then making (and sticking to) a budget.

    Quick questions

    • Can I still switch if I'm overdrawn?

      There aren't any set rules on this – it varies between providers. Whether you get an overdraft with the new provider you're switching to, and whether your limit is high enough to switch your full overdraft, will depend on the new account provider's lending procedure.

      You need to ask your new bank or building society for an overdraft. If it matches your existing limit, it'll clear the balance with your old bank. If not, the switch will go ahead but you'll still owe your old bank the money.

      The old account will remain open with a 'marker' placed on it, so you won't be able to use it, it's just so you can pay back what you owe. Some providers may give you a set amount of time to pay it back before classing it as an unarranged overdraft, which could then mean hefty fees – though you should get advance notice of this.

      Take a look at our budget planner for tips on cutting your outgoings, or if you're really struggling, see Debt Problems.

    • Can you shift the debt to a 0% credit card?

      Yes, if you qualify for the credit card and enough of a credit limit.

      There are a few specialist money transfer credit cards that let you pay cash into your bank, so you can pay off your overdraft, then you owe it instead. The top-pick card gives you 28 months at 0% in which to clear your overdraft – though you will pay a 3.94% fee to transfer the cash to your bank account.

      However, this technique can be tricky, and you need to know what you're doing, as most cards don't allow this cheaply. You can find step-by-step help in Money Transfers.

    • Can you SPEND on a credit card instead of from your current account?

      Yes, but only do it if you're disciplined. Use a cheap 0% spending card for your normal day-to-day spending, making only the minimum monthly repayments on it. This means your monthly income pays off your overdraft as no money's being taken out of that account. Instead, debt builds up on the credit card, but at 0%.

      Doing this is technically the best solution for those with self-discipline – you can't allow yourself to spend more on this card or build up more debt. You should stop using the card once your account is in credit and try to pay off the card by the end of the 0% period. Or, at worst, shift it to a cheap balance transfer deal.

    • Can you change the dates your bills go out to help money management?

      Yes. If you jump regularly between being in credit and using your overdraft, it's sensible to keep as much money in your account for as long as possible. Therefore, if you've the self-discipline, set all your household bills, direct debits and other standing orders to leave your account towards the end of your working month, artificially boosting your balance.

      This will also help to limit overdraft charges as most are levied on a daily basis, so the longer you're not in the red, the less you pay.

      If you fear this may lead to money for bills being spent before it's needed, don't take the risk. Also, take a read of the budgeting guide to help manage your cash flow.

    • Does your account give you a 0% overdraft buffer?

      If you go into an arranged overdraft by a marginal amount – usually not more than £15 – some banks will make allowances and not charge you the usual fees. See below for a list of the standard buffer amounts and charges outside this limit. Some banks also give an unarranged overdraft buffer – check with your bank if this applies to your account.

      The big banks' arranged overdraft buffers

      BANK BUFFER ZONE TEXT ALERTS (1)
      Bank of Scotland

      £10

      Yes
      Barclays

      £15

      Yes
      Halifax

      £6.99

      Yes
      Lloyds

      £6.99

      Yes
      Nationwide

      FlexDirect – £10
      FlexPlus – £250

      Yes
      NatWest/RBS

      £10

      Yes
      Santander

      £12

      Yes
      (1) These will tell you when you need to pay money in to cover payments, or when you've gone into or over an overdraft.
    • Have you registered for free 'close-to-overdraft-limit' text alerts?

      Most banks will now send you text alerts when you're in your overdraft or a payment's coming out that will put you there. Most also allow you until 3pm or 3.30pm to put extra cash into the account to allow you to avoid charges.

      To register for this service, you'll usually need to opt in through online banking or by phone, though it does vary from bank to bank. Alternatively, if you prefer to bank in branch, staff there should be able to help.

  • 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 don't want that, check out the point below...

    Quick question

    • Could you be rejected when applying for a bank account?

      Possibly. If rejected, it may be for one of many reasons, such as 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.

      If you're rejected, 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.

      The second thing you need to do is to 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.

  • 5. Can't get a bank account? There is a way...

    Sadly, more than one million people in the UK are rejected from mainstream bank accounts. Yet as long as you can prove your identity, 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.

    Quick questions

    • What does the bank charge if you try to spend more than you've got?

      Regulations mean that you won't pay anything – these accounts are designed to be free of penalty charges. But it's always best to manage your money carefully, so you've enough in your account to meet bills and other outgoings.

    • How do you open a basic bank account?

      You'll usually need to go into a branch to open these, as you'll need to show ID to do so. Make sure you ask for the basic bank account application forms specifically, or you'll get standard ones for standard bank accounts and then most likely be rejected.

  • 6. Avoid going into your unauthorised overdraft or banks turn nasty

    It's said a bank will lend you an umbrella when the sun shines and ask for it back when it rains. Go beyond your overdraft limit and this feels true. When in trouble, charges can be hefty – though regulator the Financial Conduct Authority (FCA) has announced that from 6 April 2020, banks will no longer be able to charge you extra for busting your overdraft limit.

    If overdrawn and flirting around your limit, don't just tackle the symptoms. Try using the free Budget Planner, give yourself a Money Makeover to cut bills and take a look at our Cut Overdraft Costs guide. It's also worth seeing if your bank will temporarily give you a larger overdraft limit.

    If you have got into trouble and see charge upon charge rack up so that it's put you in financial hardship, it can be possible to reclaim bank charges.

    Quick question

    • How do unauthorised overdrafts work?

      An unauthorised, or unarranged, overdraft is when you go beyond your allowed limit so you incur bank charges – you could be charged anything from interest to a daily or monthly charge – often up to £5/day (though these hefty charges are being banned from 6 April 2020).

      You can also be charged fees for paid or unpaid items – these are where a payment has taken you into your unarranged overdraft and the bank has accepted or rejected the transaction. They can be big, amounting to £5-£10 per payment.

      Banks have to have a maximum monthly charge for unarranged overdraft fees, which they must display on their sites. This should help keep costs down, though you can still face significant fees.

      As of February 2018, all banks with more than 150,000 active current accounts also have to alert you by text or through your app when you're close to going into an unarranged overdraft.

  • 7. 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. See the Best Packaged Accounts guide for more.

    Quick questions

    • What's the real annual cost of one of these accounts?

      You need to work out how much it's costing you over the year. For example, if you're paying £13 per month, that's actually £156 a year.

      And what are you getting for that? Are you getting a better mortgage rate than someone without the fee-paying account? Or better savings rates? Or lower overdraft charges?

      Just because getting the packaged account gives you 'better rates', don't think that automatically means you've got a top deal. You need to compare it to the deal you could get if you didn't have the packaged account – and then figure out if the fee's worth it.

    • What's the value of the 'benefits' you're getting?

      To evaluate how you benefit, you first need to check that you actually use the benefits the account offers.

      And if you do use them, is the account fee cheaper than getting them separately? For example, for less than £40 a year you can get annual travel insurance
      or breakdown cover. So if that's all your packaged account offers, you could be paying too much.

    • If you're not benefiting, why do you have the account?

      If the account doesn't save you money, ditch and preferably switch to a no-fee bank account. This guide will help you find the right account for you.

      If you didn't know you had a packaged account, or found out you weren't eligible to claim, you may have been mis-sold – see the Step-by-Step Reclaim Packaged Account Fees guide for full help.

Top bank accounts with perks for switching

There are some excellent deals below, but you typically need to meet certain conditions to get the full perks, so read carefully.

HSBC Advance

New. Biggest upfront bonus: free £175

Apply

If you want the biggest upfront cash bribe, you can get £175 if you switch to HSBC's Advance account. To get the bonus, you must switch within 30 days. You can also open a linked 5% regular savings account. 

How HSBC rates on
service

54% GREAT
29% OK
17% POOR
DATE: AUG 2019    VOTERS: 195

To get bonus: Apply and start a full switch within 30 days, including at least two direct debits or standing orders
Minimum monthly pay-in: £1,750 to keep the account open (or £10,500 every six months – equates to a £25,900 annual salary)
In-credit interest: None
Who's eligible for offer: Anyone who's not had an HSBC current account since 1 January 2016 and meets switching criteria
When bonus is paid: Within 30 days of switch completing
Savings protection: Shared with First Direct

Arranged overdraft cost: 17.9% EAR interest
Unarranged overdraft cost: £10 buffer, then 17.9% EAR, plus £5/day charge each day you're overdrawn (max £80/mth)

APPLY

NatWest Reward*

Big upfront cash and great for bill payers: Free £150 to switch + 2% back on bills

Apply*

The NatWest Reward* account gives £150 if you open an account and request a switch by 11.59pm on Fri 6 Dec. There's a £2/mth fee, but you get 2% cashback on most bills paid by direct debit, eg, council tax, energy, phones. The offer's also available from sister bank RBS*, though you need to apply by 29 Nov for that. 

NatWest says their average customer earns £83/yr after the fee. Our analysis shows you could earn well over £100/yr if you've higher bills – so £250+ if you switch and stay for a year.

Want to switch to a free account? You can also get the £150 with the NatWest Select* and RBS Select* accounts, but there's no bills cashback.

To get bonus: Apply & request a switch by 11.59pm on Fri 6 Dec (29 Nov for RBS). Then pay in £1,500+, complete your switch and log in to online banking by 24 Jan 2020 (10 Jan for RBS)
Minimum monthly pay-in: £1,500 (equates to £21,500/yr salary) for cashback
In-credit interest: None
Who's eligible for offer: New & existing customers switching from a non-RBS Group account, as long as you've not had switching cash from NatWest or RBS since Oct 2017
When bonus is paid: By 21 Feb 2020 (NatWest) / by 7 Feb 2020 (RBS)
Savings protection: Full

  • Do I need to close my existing account?

    Yes, to get the switching bonus you'll need to complete a full switch, which includes closing the account you're switching from. If you use the Current Account Switch Service – which you need to do to get the bonus – this is done automatically, and all payments in and out are moved across to the new account.

    You can't get the bonus if switching from other banks in the RBS Group, including NatWest, RBS and Ulster Bank.

  • What if I can't pay in £1,500 a month?

    If you don't meet the minimum pay-in requirements, NatWest/RBS will contact you to say you don't meet the account criteria, and will eventually move your account to a free Select account, which doesn't offer any bills cashback.

    However, if you still want the cashback account you can jemmy the £1,500 pay-in. For example, if you only have £750 coming in you can deposit this, withdraw it as cash or to another bank, pay it back in and BINGO, you've qualified.

  • Can I get an RBS account if I don't live in Scotland / get a NatWest account if I do?

    Yes indeed – anyone in the UK can open a NatWest/RBS account, and you can also use the other one's branches across the UK to manage your account.

  • Is there a catch with the cashback?

    NatWest/RBS has a list of qualifying suppliers (though it's worth checking about your suppliers if they're not listed). You need to pay your bills by direct debit from the account to get the cashback – for example, any payments made by debit card or standing order won't qualify. You also need to log in to online or mobile banking at least once every three months.

    The household bills that qualify for cashback are council tax, energy, mobiles, broadband and TV packages, It does not include fuels other than gas or electric such as heating oil, maintenance, insurance, TV licence, on-demand internet streaming services or any commercial contracts.

    You can redeem your cashback as soon as you reach £5, and can take this in the form of cash, vouchers with retailers such as Cineworld and Caffè Nero or a donation to one of 10 charities including Barnardo's, Cancer Research UK, Macmillan Cancer Support and NSPCC.

  • How much cashback could I really earn?

    NatWest says that on average, people earn £83/yr after the fee, the equivalent number for RBS is £59. We've crunched the numbers on how much low and high bill-payers could earn. After the fee, we worked out low users would be up by £30/yr and high users £135.

    As long as the bills are for personal (not business) household use, there is no cap on the cashback amount you can earn. For example, if you pay a child's mobile phone bill from the account as well as your main mobile bill, you'll also earn 2% back on those, which could boost your earnings.

    • Our table details how the account works for low and high bill-payers.

      NatWest/RBS Reward Account

      TYPE OF BILL ANNUAL CASHBACK
      LOW BILLS HIGH BILLS
      Water

      £5.30

      £13.80
      Council tax

      £21.20

      £63.60
      Energy

      £14.90

      £34
      Mobile phone

      £7.10

      £18.60
      Home phone

      £3.60

      £9.50
      Broadband

      £2.40

      £6.30
      Paid-for TV

      £0

      £13.20
      Fee £24/yr
      TOTAL after fee

      £30

      £135
      Amounts rounded. Based on typical bills provided by firms and Government bodies.

  • Is my money protected?

    Yes, NatWest and RBS each have the full £85,000 UK savings safety guarantee.

  • Does it have an app?

    Yes, both banks do:
    NatWest: download for iOS (rated 4.5/5) or Android (rated 4.6/5).
    RBS: download for iOS (rated 4.4/5) or Android (rated 4.5/5).

Arranged overdraft cost: £10 buffer, then £6/mth fee plus 19.89% EAR interest
Unarranged overdraft cost: £10 buffer, then £8/day fee (max nine per month) plus £8 unpaid item fee (max one per month). Maximum total charges £80/mth

APPLY*

First Direct*

Great for service + free £50 + 0% overdraft

Apply*

If customer service is crucial, First Direct's* 1st account is the one for you. It consistently ranks at or near the top of our biannual bank service polls, with 90% of its customers rating it 'great' in our latest. Plus, newbies applying and switching to this account can get a free £50. You can also open a linked 5% regular saver, and if eligible will get a £250 0% overdraft.

How First Direct rates on service

85% GREAT
9% OK
6% POOR
AUG 2019. VOTERS: 530

To get bonus: Pay in at least £1,000 within three months of account opening
Minimum monthly pay-in: None
In-credit interest: None
Who's eligible for offer: Anyone who's never held any First Direct account
When bonus is paid: Within 28 days of switching and paying in £1,000+
Savings protection: Shared with HSBC

  • How do I get the switching incentive?

    Provided you've never had any sort of account with First Direct before (including mortgages and savings), you just open the account and start your switch. You've three months to complete it and pay in £1,000.

    You can get the bonus if you're switching from HSBC or M&S Bank, even though they're both part of the HSBC Group along with First Direct.

    If you have any problems with the switching process, you can contact First Direct's account opening team on 0800 24 24 24.

  • Do I need to close my existing account?

    Yes, to get the switching bonus you'll need to complete a full switch using the Current Account Switch Service, which automatically closes the account you're switching from and moves across all payments in and out.

  • Can I open two of these accounts?

    You can open two accounts if the second one is a joint account, but you'll only get the switching bonus once (as it's just for new customers). Plus opening a joint account financially links you with the other person, so think carefully before doing so.

  • Are there any other perks?

    You can sign up to First Direct's Visa Offers scheme, which gives tailored cashback deals at selected retailers based on your spending habits. Once you've signed up, cashback is paid automatically within five working days of each valid spend.

    Plus, if you don't like First Direct after six months, leave and it'll give you a free £100. To get it, you need to have paid in £1,000/mth for at least six months, not have had your account open for more than a year and have switched to First Direct originally.

  • Is my money protected?

    Yes, but First Direct shares its £85,000 UK savings safety guarantee with HSBC, so ensure you don't hold more than £85,000 across the two banks.

  • Does it have an app?

    Yes – downloadable for iOS (rated 4.8/5) or Android (rated 4/5).

Arranged overdraft cost: 0% under £250, 15.9% EAR interest above that
Unarranged overdraft cost: £10 buffer then £5/day (max £80/mth)

APPLY*

M&S Bank*

Good for M&S shoppers: Free £100 gift card + £80 gift card after a year

Apply*

Open an M&S Bank* current account and switch within three months, including four or more active direct debits, and you'll get a £100 M&S gift card. Many also get a decent £100 0% overdraft, and you get reward points when you shop in M&S and access to a linked 5% regular saver.

You can get another £80 gift card (£120 if you've an M&S Bank credit card) after a year if you deposit £1,250/mth, keep at least four direct debits active, and register for online banking and statements. So keep the account for a year and you could get £180 (£220 if you've an M&S credit card).

To get bonus: For the £100 gift card, switch within three months, including at least four active direct debits. For the extra £80 gift card, pay in £1,250/mth, keep direct debits active and register for online banking.
Minimum monthly pay-in: None (£1,250 for second gift card)
In-credit interest: None
Who's eligible for offer: Anyone who's never switched to M&S Bank
When bonus is paid: £100 gift card within a month of switch completing, second gift card within one month of the anniversary of account opening
Savings protection: Full

  • What's the deal with the reward points – how much are they worth?

    If you spend using your debit card for this account, you'll get one point for every £1 spent in M&S or in its online store. You get one £1 voucher for every 100 points, and M&S sends these to you quarterly. Bear in mind that this means you'd need to spend £500 at M&S just to get a £5 voucher.

  • How does the overdraft work?

    If you're accepted for an account, M&S Bank gives you an automatic £500 overdraft – though you may get more if your credit score's good enough.

    The first £100 of an arranged overdraft is interest-free, and you're charged interest of 15.9% EAR on anything above that. M&S doesn't charge unarranged overdraft fees on top of the interest, but at the same time, doesn't let you go more than £50 over your overdraft limit (except if payments are guaranteed).

  • When do I get the gift cards?

    If accepted, you'll need to switch within three months. Once you've completed your switch, the £100 gift card will be posted to you within a calendar month.

    To get the second gift card, you need to pay in £1,250/mth for at least 10 months out of 12 (starting the month after the switch completes), plus keep four direct debits active and register for online banking and statements within three months of opening your account. It'll be posted to you within a month after the anniversary of you opening the account.

    You won't get the bonus if you've previously switched a current account to M&S Bank.

  • Do I need to close my existing account?

    Yes, to get the switching bonus you'll need to complete a full switch, which includes the closure of the account you're switching from. If you use the Current Account Switch Service this is done automatically, and all payments in and out are moved across to the new account.

  • My current bank isn't signed up to the CASS. Can I still get the switching bonus?

     No, for this offer you have to use the Current Account Switch Service.

  • Is my money protected?

    Yes, M&S Bank has the full £85,000 UK savings safety guarantee.

  • Does it have an app?

    Yes – downloadable for iOS (rated 4.4/5) or Android (rated 1.8/5).

Arranged overdraft cost: 0% up to £100, 15.9% EAR above that
Unarranged overdraft cost: £50 buffer, 15.9% EAR interest. M&S Bank only allows you to go £50 over your overdraft limit

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Barclays*

Good for ongoing rewards: At least £120 cashback in the first year (£204 with Premier account)

Apply*

Open a Barclays* account, sign up to its Blue Rewards scheme and start a switch by 30 Nov 2019 to get £10/mth in the first year (it’s actually £14/mth but there's a £4/mth fee). From year two you're up £3/mth (£7/mth minus the same £4/mth fee).

To get it, you need to sign up to mobile or online banking, while each month you must pay in £800+ and pay out two direct debits. If you've other Barclays products, you can get more cash (see FAQs).

Get £204 in year one with the Barclays Premier account

You can get £17/mth back for a year (£21/mth minus the £4/mth fee) if you switch to the Barclays Premier account – though to be eligible you need at least £100,000 saved or invested with Barclays, or an annual income of £75,000+ paid into the account.

How Barclays rates on service
 

52% GREAT
29% OK
19% POOR
AUG 2019. VOTERS: 210

Minimum monthly pay-in: £800 (equates to £10,000 annual salary) to get rewards
In-credit interest: None
Who's eligible for offer: New and existing customers
When bonus is paid: Blue Rewards paid monthly
Savings protection: Full

  • Do I need to close my existing account?

    Yes, to get the switching bonus you'll need to complete a full switch using the Current Account Switch Service, which automatically closes the account you're switching from and moves across all payments in and out.

  • What about tax on the rewards?

    The rewards that Barclays pays are classed as 'cashback', meaning they're not taxable, so you don't need to worry about declaring them to the taxman.

  • Are there any other perks?

    You can also get cashback with about 150 retailers. If you have Blue Rewards, you get an additional 1% cashback, boosted to 2% for the first year if you switch (or 3% for a year if you're a Premier customer).

  • What extra cashback can I get?

    You'll also get up to an extra £14/mth if you've got certain Barclays products:

    • £5/mth if you've a Barclays mortgage.
    • £3/mth if you've a combined Barclays home insurance policy (£1/mth if you've either building or contents).
    • £1/mth if you've a Barclays loan.
    • £1.50/mth if you've Barclays life insurance (or £5/mth if you have life insurance with critical illness cover).

    The cashback you get on each of these will be doubled for the first year if you switch (so up to £28/mth), or tripled if you've a Premier account (so up to £42/mth). However, don't use the cashback as a reason to take out any extra products with Barclays without checking if they're right for you.

  • Is my money protected?

    Yes, Barclays has the full £85,000 UK savings safety guarantee.

  • Does it have an app?

    Yes – downloadable for iOS (rated 4.8/5) or Android (rated 4.5/5).

  • What counts as starting a switch?

    Starting a switch means either agreeing to switch an account online after acceptance and completing it in a branch, or just opening an account online then switching in the app.

Arranged overdraft cost: £15 buffer then 75p/day under £1,000, £1.50/day between £1,000 and £2,000, and £3/day over £2,000
Unarranged overdraft cost: £15 buffer, then £5/day for 'emergency borrowing' (max £35/mth)

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Other switching offers

  • Get £100 if a friend refers you to Nationwide (or you refer them). If you know someone with a Nationwide current account, savings account or mortgage, they can refer you. Then, if you switch to a Nationwide FlexAccount, FlexDirect or FlexPlus account – including at least two direct debits – you'll both receive £100. If you've a Nationwide account already, you can refer friends yourself, and earn up to £500 per tax year. 

    The referrer needs to fill in a form with their details, then email their referral link to their friend. The referee needs to follow that link and enter details including their 'switch reference number'. The £100 will be paid into both accounts within 30 days of the switch completing.

    Note, if you plan to switch soon after receiving the £100 it's best to wait at least three months. Under the terms of the offer, Nationwide says it may reclaim the switching cash from both of you if the recommended friend closes their account 'without good reason' within three months of receiving the bonus.  

Top bank accounts that pay savings interest

Sadly, these aren't as attractive as they used to be given the low interest rate environment, but here are the top deals as they stand.

Nationwide FlexDirect*

Good for smaller savings: 5% interest on £2,500 fixed but only for a year, 1% afterwards

Apply*

Open a Nationwide FlexDirect* account and you'll get an interest rate of 5% AER fixed for a year on up to £2,500, as long as you haven't had a FlexDirect account before and pay in £1,000+/mth. The rate drops to 1% after a year, so look elsewhere then to see if it can be beaten. 

Plus, if you get a friend with a Nationwide account to refer you and you switch – including two direct debits – you'll both receive £100. You can also earn up to £500 per tax year by referring friends once you've got an account.

How Nationwide rates on
service    

70% GREAT
21% OK
9% POOR
AUG 2019. VOTERS: 532

Minimum monthly pay-in: £1,000/mth to get interest (equates to £12,500 annual salary)
In-credit interest: 5% AER fixed on up to £2,500 for 12 months, 1% AER variable after
Savings protection: Full

  • What if I can't pay in £1,000 each month?

    You just won't be paid any interest that month.

  • How much will the overdraft cost?

    For the first year, your overdraft will cost nothing as long as you stay within your limit and you haven't had a FlexDirect account before. After that, you'd pay 50p each day you're overdrawn (within your limit). So if you had a limit of £1,500 and owed £1,000, you'd pay £182.50 if you're overdrawn every day of the year.

    Don't bust your overdraft limit, as you'll pay £5 a day plus a £5 charge for every paid or unpaid item.

    If you're switching to this account with an existing overdraft, you could use the 12 months when your overdraft is at 0% to get your finances in order and avoid future fees. For tips, see Cutting Overdraft Costs.

  • Can I have two accounts? And two overdrafts?

    You can have two accounts, and can even get two lots of interest – though one of your accounts must be joint. Nationwide says you may be able to get two overdrafts if you have two FlexDirect accounts, but each would be assessed on its merits, so there's no guarantee.

  • Is my money protected?

    Yes, Nationwide has full Financial Services Compensation Scheme protection, so any money saved with it is safe up to £85,000.

  • Does it have an app?

    Yes – downloadable for iOS (rated 4.8/5) or Android (rated 4.2/5).

Arranged overdraft cost: Year one: 0%. Years two+: £10 buffer, then 50p/day (39.9% APR interest from 11 Nov 2019)
Unarranged overdraft cost: Under £10: 50p/day. Over £10: £5/day (max £35/mth). No charges from 11 Nov 2019. £5 paid/unpaid item fee (max £15/mth). Total unarranged fees capped at £50/mth

APPLY*

TSB Classic Plus*

Earn 3% variable interest on up to £1,500

Apply*

The TSB Classic Plus* account pays 3% AER on the first £1,500 in your account. To get it, you must pay in £500 each month and be registered for online and paperless banking. If you don't meet the criteria in any given month, you won't be paid interest for that month.

How TSB rates on
service    

46% GREAT
33% OK
21% POOR
AUG 2019. VOTERS: 174

Rate: 3% AER variable on up to £1,500
Min monthly pay-in: £500 to get interest (equates to a £6,000 annual salary)
How to open/access: Open online or in branch, manage online, in branch or by phone
Interest paid: Monthly
Savings protection: Full

  • How much interest can I earn?

    If you save the max in this account for one year, you'd earn £44 in interest – assuming the variable rate of interest rate doesn't change.

  • Is my money protected?

    Yes, TSB has full Financial Services Compensation Scheme protection, so up to £85,000 saved with it is safe.

  • How many accounts can I open?

    You can have two accounts, and can even get two lots of interest – though one of your accounts must be joint to get this.

Arranged overdraft cost: £35 fee-free. Above this, you pay £6/mth + 1.52%
Unarranged overdraft cost: Under £10: £0, £10-£25: £6/mth + £5/day, £25+: £6/mth + £10/day. Total unarranged overdraft fees are capped at £80/mth

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Other interest-paying current accounts

It's not just these accounts that offer decent interest rates. A few others give you varying levels of interest (see below), and the one you pick should depend on how much cash you're likely to be able to keep in your account.

For comparison, the top easy-access savings deal open to all pays 1.5%.

TABLE_CELL_STYLE

 IN-CREDIT INTEREST (AER) MAX
INTEREST /YR (1)		 MIN MONTHLY PAY-IN HOW MANY CAN YOU HAVE?
Bank of Scotland Vantage 1.5% on up to £5,000 (changing from 1 Oct to 1% on up to £3,999.99 and 2% on balance between £4,000-£5,000)
 £74.50 £1,000 (2) 3
Club Lloyds 1.5% on up to £5,000 (changing from 1 Oct to 1% on up to £3,999.99 and 2% on balance between £4,000-£5,000)
 £74.50 £1,500 (3) 2 (2nd must be joint)
(1) Before any tax if you always held the max balance+. (2) You need 2+ direct debits going out to get the interest, and must also add the 'Vantage' feature to your account. (3) If you don't pay in this much, there's a £3/mth fee. You also need 2+ direct debits going out to get the interest.

Top bank accounts that give ongoing bills cashback

Some accounts give free cash as a percentage of what you pay out in bills, though many come with a fee, so check you spend enough on bills for it to make financial sense.

NatWest Reward*

Best for higher bills or switchers: 2% cashback on bills + free £150 to switch

Apply*

If you have high monthly bills, the NatWest Reward* account (also available from sister bank RBS*) is a good option. For a £2 monthly fee, it pays 2% cashback on council tax, gas, electricity, water, home phone, mobile, TV and broadband bills, as long as you pay by direct debit, pay in £1,500/mth and log in to online or mobile banking every three months.

If you're switching to this account, you can get £150 to do so. Apply and request a switch by 11.59pm on Fri 6 Dec (29 Nov for RBS). To get it, pay in £1,500+, complete your switch and log in to online banking by 24 Jan 2020 (10 Jan for RBS).

If you have a Santander mortgage and don't want to switch, the Santander account below could beat these, as it pays 1-3% cashback on the same bills plus up to £10/mth on Santander mortgages, and comes with a lower £1/mth fee.

Minimum monthly pay-in: £1,500 (equates to a £21,500 annual salary)
In-credit interest: None
Savings protection: Full

  • What if I can't pay in £1,500 a month?

    If you don't meet the minimum pay-in requirements, NatWest/RBS will contact you to say you don't meet the account criteria, and will eventually move your account to a free Select account, which doesn't offer any cashback.

    However, if you still want the cashback account you can jemmy the £1,500 pay-in. For example, if you only have £750 coming in you can deposit this, withdraw it either as cash or to another bank, then pay it back in, and BINGO, you've qualified.

  • Is there a catch with the cashback?

    NatWest/RBS has a list of qualifying suppliers (though it's worth checking with them about your suppliers if they're not listed). You need to pay your bills by direct debit from the account to get the cashback – for example, any payments made by debit card or standing order won't qualify.

    The household bills that qualify for cashback do not include fuels other than gas or electric such as heating oil, maintenance, insurance, TV licence, on-demand internet streaming services or any commercial contracts.

    You can redeem your cashback as soon as you reach £5, and can take this in the form of cash, vouchers with retailers such as Cineworld and Caffè Nero or a donation to one of 10 charities including Barnardo's, Cancer Research UK, Macmillan Cancer Support and the NSPCC.

  • Can I get the RBS account if I don't live in Scotland/ get the NatWest account if I do?

    You can indeed. Anyone in the UK can open an RBS/NatWest account, and you can also use the other one's branches across the UK to manage your account.

  • How much cashback could I really earn?

    NatWest says its customers earn £83 on average per year after the fee; RBS says its equivalent figure is £59. We've crunched the numbers on how much low and high bill-payers could earn. After the fee, we worked out low users would be up by £30/yr and high users £135.

    As long as the bills are for personal (not business) household use, there is no cap on the cashback amount you can earn, eg, if you pay a child's mobile phone bill from the account as well as your main mobile bill, you'll also earn 2% back on those, which could boost your earnings.

    • Our table details how the account works for low and high bill-payers.

      NatWest/RBS Reward Account

      TYPE OF BILL ANNUAL CASHBACK
      LOW BILLS HIGH BILLS
      Water

      £5.30

      £13.80
      Council tax

      £21.20

      £63.60
      Energy

      £14.90

      £34
      Mobile phone

      £7.10

      £18.60
      Home phone

      £3.60

      £9.50
      Broadband

      £2.40

      £6.30
      Paid-for TV

      £0

      £13.20
      Fee £24/yr
      TOTAL after fee

      £30

      £135
      Amounts rounded. Based on typical bills provided by firms and Government bodies.

  • Is my money protected?

    Yes, both NatWest and RBS have separate, full £85,000 UK savings safety protection.

  • Does it have an app?

    Yes, both banks do:
    NatWest: download for iOS (rated 4.5/5) or Android (rated 4.6/5).
    RBS: download for iOS (rated 4.4/5) or Android (rated 4.5/5).

Arranged overdraft cost: £10 buffer, then £6/mth fee plus 19.89% EAR interest
Unarranged overdraft cost: £10 buffer, then £8/day fee (max nine per month) plus £8 unpaid item fee (max one per month). Maximum total charges £80/mth

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Santander 123 Lite*

Best if you've smaller bills or a Santander mortgage: 1-3% cashback on bills

Apply*

The Santander 123 Lite* gives tiered cashback on certain household bills for a £1 monthly fee. You get 3% on phone, broadband, mobile and TV bills, 2% on gas and electricity, Santander home insurance and life protection, and 1% on water and council tax, as long as you pay by direct debit. Have a Santander mortgage? You also get 1% cashback (max £10/mth) on it, which can give seriously good returns on this account.

To get cashback, you need to pay in £500+/mth, have two active direct debits, pay your monthly fee and log in to online or mobile banking at least once every three months. Watch out – it counts a month from the anniversary of account opening, not a calendar month.

How Santander rates on service

63% GREAT
28% OK
9% POOR
AUG 2019. VOTERS: 619

Minimum monthly pay-in: £500 (equates to a £6,000 annual salary)
In-credit interest: None
Savings protection: Shared with Cahoot

  • Is there a catch with the cashback?

    Santander has a list of qualifying suppliers (though it's worth checking with it about your suppliers, if they're not listed). You also need to pay your bills by direct debit from the account to get the cashback.

  • How much cashback could I really earn?

    We've crunched the numbers on how this stacks up for low, average and high bill-payers. After the fee, we worked out low users would be up by £66/yr, average users £138 and high users £252, assuming they have a Santander mortgage. Without a Santander mortgage, low users would be up by £36/yr, average users £72 and high users £132.

    The cashback works best for those who have a mortgage payment of about £1,000/mth with Santander – but even without the mortgage payment, you should still be able to make money from this account, even after the fee is covered.

    • Our table details how the account works for low, medium and high bill-payers.

      Santander 123 Lite – cashback earned

      TYPE OF BILL CASHBACK % ANNUAL CASHBACK
      LOW BILLS TYPICAL BILLS HIGH BILLS
      Water

      1%

      £2.60

      £4

      £6.90
      Council tax

      1%

      £10.60

      £15.90

      £31.80
      Santander mortgage (1)

      1%

      £30

      £66

      £120
      Energy

      2%

      £14.90

      £23.30

      £34
      Mobile phone

      3%

      £10.60

      £15.90

      £27.90
      Home phone

      3%

      £5.40

      £8.10

      £14.20
      Broadband

      3%

      £3.60

      £5.40

      £9.50
      Paid-for TV

      3%

      £0

      £11.30

      £19.70
      Fee   £12/yr
      TOTAL after fee (incl Santander mortgage)   £66 £138 £252
      TOTAL after fee (excl Santander mortgage)   £36 £72 £132
      (1) Santander mortgage payment cashback capped at £10/mth.
      Amounts rounded. Based on typical bills provided by firms & Government bodies.

  • What about the Santander 123 account?

    The main Santander 123 account comes with the same cashback, but has a higher £5 monthly fee. It also pays 1.5% AER variable interest on up to £20,000, though the higher fee means it's beaten by getting the 123 Lite and the top easy-access savings account.

  • Are there any other perks?

    You also get access to a linked 3% regular saver.

  • Is my money protected?

    Yes, but Santander shares its £85,000 UK savings safety guarantee with Cahoot, so don't hold more than £85,000 across the two banks.

  • Does it have an app?

    Yes – downloadable for iOS (rated 4.8/5) or Android (rated 4.4/5).

Arranged overdraft cost: 0% for four months after switching. Then £1/day below £2,000, £2/day from £2,000-£2,999.99 and £3/day over £3,000
Unarranged overdraft cost: None (arranged overdraft fees still apply)

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Other accounts that offer rewards

While they don't make it into our top picks above, there are a few other accounts that offer monthly cash payments in return for your custom. We wouldn't suggest you specifically switch to them over the other accounts in this guide, but if you want some extra rewards you could consider them:

  • Sign up to Co-op Bank's Everyday Rewards scheme and you can earn up to £5.50/mth. You'll get £4 each month you pay in £800, pay out four direct debits, receive paperless statements, log in to online or mobile banking, and stay within your overdraft limit. If you meet all the criteria above, you'll also get 5p per debit card transaction, up to a maximum of £1.50 per month, though getting this isn't worth spending more than you usually would.
  • Barclays Blue Rewards is an add-on to Barclays current accounts which, for a £4 monthly fee, will pay you at least £7/mth back – as long as you pay in £800+ and pay out at least two direct debits each month. You can get even more if you hold selected products with Barclays. See above for full details of the scheme, including a switch offer giving double rewards for a year.

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.

Nationwide FlexPlus* (monthly fee £13 or £156/yr)

£500+/yr of travel, mobile & breakdown cover for £156/yr 

Apply*

Nationwide's FlexPlus* account is a cracking deal – IF you use the features. For £13/mth, you get worldwide family travel insurance (including winter sports) up to your 70th birthday, family smartphone insurance and UK and Europe breakdown cover for the account holder(s). We've calculated that all the insurance could be worth £500+/yr for a family of four (see FAQs).

If you get a friend with a Nationwide account to refer you and you switch – including two direct debits – you'll both receive £100. Plus, until November you also get 3% AER variable interest on up to £2,500

How Nationwide rates on
service

70% GREAT
21% OK
9% POOR
AUG 2019. VOTERS: 532

In-credit interest: 3% AER variable on up to £2,500 (until Nov 2019)
Monthly fee: £13
Min monthly pay-in: None
Savings protection: Full

  • How did you work out the value of the insurance?

    - Mobile cover for all the family's smartphones. The cheapest smartphone insurance costs £80-£100/yr. If there are four of you, that's £320-£400's worth.
    - World family travel insurance (incl winter sports and golf cover). The cheapest family cover we've found elsewhere is from around £90/yr (£105/yr incl winter sports), plus £20/yr for golf cover. If any of you are aged 65+, it'll be even more.
    - European breakdown cover. Covers account holder(s) in any car, and anyone driving their car with permission. Similar breakdown cover we've found elsewhere is from £70/yr.

    A family of four needing it all could pay £500+/yr buying all the comparable insurances separately. Do bear in mind that the price of individual cover will vary with the number of people in your family being covered.

  • What does the worldwide family travel insurance cover?

    It allows multiple trips worldwide and includes winter sports, business, wedding and golf cover (includes golf fees).

    It covers you, children under 19 (or 22 if in full-time education) providing they live at the same address and your partner, even if it's not a joint account. The excess (the amount you pay towards a claim) is a maximum of £50. If you've a pre-existing condition, tell Nationwide as you may need a medical screening before getting cover and could be charged.

  • I'm over 70. What about me?

    If you're 70 or over, you'll need to pay a £65/yr premium for your travel cover. This isn't necessarily the best deal on the market, so always compare with the premiums in Cheap Travel Insurance.

  • What does the mobile phone insurance cover?

    It covers repair or replacement after theft, loss, damage or breakdown, insuring each handset up to the value of £1,000, plus the iPhone XR/XS which can cost more (up to £1,500 from 1 Nov 2019). The excess is a maximum of £100 for an iPhone (£125 from 1 Nov 2019).

    Unusually, it covers the phones of your partner and children too, provided they live with you (children must be under 19 or under 22 if in full-time education, and cannot be married or in a civil partnership) – so maxed out, this gives serious value. You can make a maximum of four claims per year.

    See the mobile insurance policy document for more details. 

  • What does the breakdown cover include?

    It's for the UK and Europe including home assistance and onward travel. Cover is for the person, and people travelling in your vehicle (so everyone would be taken to their destination). On a joint account both account holders would be covered.

    You can also register one vehicle per account holder, and anyone driving that vehicle with your permission will be covered.

    For more policy details, see the travel insurance, mobile insurance and UK and Europe breakdown cover documents.

  • Can I use the card abroad?

    The account's debit card has no fee or 'load' for spending or withdrawing cash, making it a leading debit card for overseas use.

  • Is my money protected?

    Yes, Nationwide has full Financial Services Compensation Scheme protection, so any money saved with it is safe up to £85,000.

  • Does it have an app?

    Yes – downloadable for iOS (rated 4.8/5) or Android (rated 4.2/5).

Arranged overdraft cost: £250 fee-free buffer, 50p/day above that (No buffer and 39.9% APR interest from 11 Nov 2019)
Unarranged overdraft cost: Up to £10, you're charged 50p/day. Over £10, you're charged £5/day (max £50/mth). No charges from 11 Nov 2019.

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Top accounts if you're overdrawn

Overdrafts are debts, and often they're more expensive than credit cards, so aim for an account with the lowest fees.

But if overdrawn, don't just tackle the symptoms. Also try using the free budget planner, give yourself a money makeover to tackle its causes and check our Cut Overdraft Costs guide.

First Direct*

£250 0% overdraft, great service plus £50 to switch

Apply*

If you just dip in and out of your overdraft, the First Direct* account should cover you for free, as it offers a £250 0% overdraft. Above that you'll pay 15.9% EAR, one of the lowest costs out there. It's also a cracking account for service, with 90% ranking it 'great' in our last poll. You also get access to a linked 5% regular saver.

Newbies who apply and switch to it can also get a free £50. You need to pay in at least £1,000 within three months of your account opening.

How First Direct rates on
service

85% GREAT
9% OK
6% POOR
AUG 2019. VOTERS: 530

Minimum monthly pay-in: None, though need to pay in £1,000 within 3 months for bonus
In-credit interest: None
Who's eligible for switch offer: Anyone who's never held a First Direct account
When bonus is paid: Within 28 days of meeting all criteria
Savings protection: Shared with HSBC

  • How do I get the switching incentive?

    Provided you've never had any sort of account with First Direct before (including mortgages and savings), then just open the account and start your switch. You've three months to complete it and pay in £1,000.

  • What if I can't pay in £1,000 every month?

    If your salary reduces and you can no longer pay in £1,000/mth, you'll be whacked with a £10 monthly fee. However, if you have another account with First Direct – savings, mortgage, credit card, loan or home insurance – then it's waived, so just open a bog standard savings account (this trick excludes the 5% regular savings account), and put the minimum amount in.

    The fee will also be waived if you maintain an average monthly balance of £1,000 or more.

  • Can I open two of these accounts?

    You can open two accounts if the second one is a joint account, but you'll only get the switching bonus once (as it's only for new customers). Plus opening a joint account financially links you with the other person, so think carefully before doing so.

  • Are there any other perks?

    You can sign up to First Direct's Visa Offers scheme, which gives tailored cashback deals at selected retailers based on your spending habits. Once signed up, cashback is paid automatically within five working days of each valid spend.

  • Is my money protected?

    First Direct shares its £85,000 UK savings safety guarantee with HSBC, so ensure you don't hold more than £85,000 across the two banks.

  • Does it have an app?

    Yes – downloadable for iOS (rated 4.8/5) or Android (rated 4/5).

Arranged overdraft cost: 0% under £250, 15.9% EAR interest above that
Unarranged overdraft cost: £10 buffer then £5/day (max £80/mth)

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Nationwide FlexDirect*

12 months' 0% overdraft – a respite to sort your finances

Apply*

The Nationwide FlexDirect* account offers a year's 0% overdraft, as long as you haven't had a FlexDirect account before. It's important that you see this as a respite to try to clear your overdraft, as you do start paying for it (although fees are lowish at just 50p/day) once you've had the account for a year.

There's no guaranteed overdraft limit, and what you get is subject to a credit check, so if you're switching to this account you may not be offered one as large as your existing overdraft.

Plus if you get a friend with a Nationwide account to refer you and you switch – including two direct debits – you'll both receive £100. You can also earn up to £500 per tax year by referring friends once you've got an account.

How Nationwide rates on
service

70% GREAT
21% OK
9% POOR
AUG 2019. VOTERS: 532

Minimum monthly pay-in: None (£1,000/mth to get interest)
In-credit interest: 5% in year one on up to £2,500, 1% in subsequent years
Savings protection: Full

  • How much will the overdraft cost?

    For the first year, your overdraft will cost nothing as long as you stay within your limit and you haven't had a FlexDirect account open within the last year. After that, you pay 50p each day you're overdrawn (within your limit). So if you have a limit of £1,500 and owe £1,000, you'll pay £182.50 if you're overdrawn every day of the year.

    Don't bust your overdraft limit, as you'll pay £5/day plus a £5 charge for every paid or unpaid item.

    If you're switching to this account with an existing overdraft, you can use the 12 months when your overdraft is at 0% to get your finances in order and avoid future fees. For tips, see Cutting Overdraft Costs.

  • How do I get the interest?

    To get interest you need to pay in £1,000/mth, though you only get interest when you're in credit.

  • What if I can't pay in £1,000?

    Nothing happens, you just won't be paid any interest that month.

  • Can I have two accounts? And two overdrafts?

    You can definitely have two accounts, and can even get two lots of interest – though one of your accounts must be joint. Nationwide says you may be able to get two overdrafts if you have two FlexDirect accounts, but each would be assessed on its merits, so there's no guarantee.

  • Is my money protected?

    Yes, Nationwide has full Financial Services Compensation Scheme protection, so any money saved with it is safe up to £85,000.

  • Does it have an app?

    Yes – downloadable for iOS (rated 4.8/5) or Android (rated 4.2/5).

Arranged overdraft cost: Year one: 0%. Years two+: £10 buffer, then 50p/day (39.9% APR interest from 11 Nov 2019)
Unarranged overdraft cost: Under £10: 50p/day. Over £10: £5/day (max £35/mth). No charges from 11 Nov 2019. £5 paid/unpaid item fee (max £15/mth). Total unarranged fees capped at £50/mth

APPLY*

Starling Bank*

Easy-to-control overdraft with a lowish rate, plus no extra charges if you bust your limit

Apply*

While it doesn't offer a 0% overdraft, app-based Starling Bank* has one of the lowest standard overdraft costs of 15% EAR interest (waived if less than 10p in any month). Unusually, it won't charge you extra if you go over your agreed overdraft limit, though you won't be able to use your account until you bring your balance back inside your limit.

It's also easy to control your overdraft limit in the app, and Starling will send you real-time notifications when you use your debit card and when you're about to go into, or are using, your overdraft.

Minimum monthly pay-in: None
In-credit interest: 0.5% AER variable on up to £2,000. 0.25% between £2,000 and £85,000
Savings protection: Full

  • What else can the app do?

    As well as providing spending notifications and insights, the app lets you freeze and unfreeze your debit card at the touch of a button, report it lost or stolen or get a PIN reminder in-app. You can also turn off certain functions of your card, such as online spending, contactless payments or ATM withdrawals if you want to control a specific type of spending.

    Starling has just launched its 'Marketplace', which lets you use other companies' services through the Starling app. There's only one company featured at the moment, but in future it plans to offer products such as ISAs, savings accounts, insurance and mortgages.

  • Are there limits on using the debit card?

     You can make up to three cash withdrawals a day, totalling a maximum of £300.

  • What exchange rate will I get overseas?

    The debit card is a Mastercard, so you'll get the Mastercard rate, which you can check here. There are no fees to use your card abroad, making it a top pick for overseas use.

  • Will Starling credit-check me?

    If you apply for an overdraft, Starling will run a full credit check on you. If you apply for the account without an overdraft, it'll just run an ID check on you, which won't appear to lenders on your credit report (though you'll be able to see it).

  • Is my money protected?

    Yes, Starling Bank has full Financial Services Compensation Scheme protection, so any money saved with it is safe up to £85,000.

  • Does it have an app?

    Yes. It's an app-based bank, so you need to use the app to manage your account. You can download it for iOS (rated 4.9/5) or Android (rated 4.7/5).

Arranged overdraft cost: 15% EAR interest variable (waived if less than 10p in any month)
Unarranged overdraft cost: 15% EAR variable (waived if less than 10p in any month). Max £2/mth

APPLY*

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 is 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 it can't (or won't), or you don't hear back from it, you can escalate your complaint to the free Financial Ombudsman Service.

Q&A bank accounts

  • How does it work with reward payments and tax?

    As well as offering in-credit interest or bonuses for switching, a few 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.

    Some 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.

    With the introduction in April 2016 of the personal savings allowance (PSA), meaning interest is now paid tax-free, some people hoped that they'd see an increase in the reward amounts paid to them.

    However, 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 PSA, and they're still 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 billions 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 if I can't pay a set amount into my bank account every month?

    This isn't usually a problem. Mostly it just means that you won't get whatever benefits that account offers for that month, though watch out for the First Direct and Lloyds accounts, as they'll charge you a fee if you don't meet the minimum pay-ins.

    Other accounts will just not pay you interest, for example, the Halifax Reward and Santander accounts don't need regular monthly deposits, but unless you sometimes pay at least £750 and £500 in respectively, you'll never earn any interest.

    Unusually, M&S Bank offers a decent current account with no minimum pay-in required for most of its benefits.

  • I applied for one of these accounts and got rejected. What can I do?

    You could try a basic bank account. These don't credit score you (though you need ID) as they don't offer overdrafts. Make sure you ask for their application forms, or you'll get standard ones for standard bank accounts and then be rejected. Full help and tips in our Basic Bank Accounts guide.

  • How do I find my local branch?

    If you go onto your bank's website, it will have a 'branch finder' facility. Usually you'll have to type in your location or postcode and your nearest branch will come up. If you're searching on a mobile phone, often it will link to your GPS location and will automatically show you where your closest branch is.

    If you just want to find your closest bank and don't mind which bank it is, then visit Yell.com and type that you're searching for a bank and your postcode. It will then list the nearest branches and tell you how far away they are.

    Bear in mind, though, that this may miss banks' agencies – they're often found in local solicitors' or estate agents' offices. For these, you may have to ask locally.

  • How long do transfers take?

    Most banks these days use Faster Payments for bank transfers, meaning most transfers you make should arrive within two hours, or at least the same day.

    Faster Payments is available 24 hours a day, 365 days a year, so even if you transfer some money to someone you owe on Christmas Day, it will arrive in their account the same day.

    If for any reason your bank or building society can't use Faster Payments (many credit unions can't, for example), then they will do a BACS transfer, which takes three to five working days.

  • How long does a cheque take to clear?

    It depends on which bank you're with, as a new system has started rolling out to speed up the process to the end of the next working day.

    The old system used the basic principle of 2-4-6. After two working days, any interest will start to be earned on the money from the cheque. After four working days, the funds will be available for you to use. And after six working days, the money cannot be taken from you (unless you have acted fraudulently).

    Cheques could take a day longer than the 2-4-6 system if you pay in a cheque late in the business day, as it may not be processed until the next working day.

    Under the new system, which began in October 2017, image-based clearing means you'll be able to withdraw money from a cheque by the end of the next working day at the latest. By summer 2018, all banks and building societies should use the faster process.

  • How long does it take for money I pay in to count towards my balance?

    If you pay the money in over the counter in your branch, then the money will count towards your balance immediately. However, if you pay the money in via one of the bank's ATMs, it will vary and can take up to two more days to count towards your balance.

  • 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.

    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.

    A recurring payment 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 DVD rental service or a gym membership. 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.

  • How do I set up a direct debit or standing order?

    Direct debits are set up by the company you're paying. In most instances, the company will ask for your account details and they'll set up a direct debit for you. However, sometimes they'll send you a direct debit form that you need to fill out and hand in to your bank or send back. You can't set up a direct debit yourself.

    A standing order is a payment you can set up yourself. You'll do this via your bank, in branch, on the phone or online. To set one up, you'll need the account details you're sending money to and you'll need to put in a set amount you want to send each time (you can change the amount with a day or two's notice).

  • What day will my switch happen on?

    If you don't specify a date, everything will be switched over seven working days after the switch begins. If you opt for a specific date, the process begins seven working days before that date.

  • Will my new debit card and PIN arrive within the seven days?

    Bizarrely, given the song and dance about seven-day switching, your debit card and PIN aren't covered by it. So despite your account being open and set up – and your old account closed – in seven working days, you may have to wait a few days to access your money.

  • How do I transfer money using a mobile phone number?

    If you have a smartphone, you can use a service called Paym, which allows you to transfer up to £250 a day by using a mobile phone number.

    You need to link your mobile phone number to your account, through your mobile phone app or your online banking. Once linked, you can make a payment by selecting the person you want to pay from your mobile phone contacts, or manually enter a mobile phone number – but you can only send cash this way to people who have also registered their mobile number to receive mobile payments.

    You'll then be asked to confirm the name of the recipient. Once you're happy, check the amount and press 'send'. You'll also receive confirmation that your payment has been sent. And don't worry, you won't be able to pay anyone who isn't registered.

    See the Mobile-To-Mobile Transfer MSE News story for more.

  • Is internet and mobile banking safe?

    Yes. Banks have security systems in place that ensure fraudsters can't hack into your account, whether you're logged in online or on your phone. But you still need to be careful – never ever send your online/mobile banking information to anyone.

    If you're using a mobile app, make sure you download your bank's official mobile app from your app store and make sure you update the app regularly with any new security features.

    It's also worth keeping your computer up to date with Free Antivirus Software, so you're protected from viruses and spyware.

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

    When sending money to a different account, for now the only information banks use to identify payees is the sort code and account number, and not the recipient's name, meaning if these details are wrongly entered the cash could end up in a stranger's bank account.

    However, all is not lost. The UK's largest six banking groups (which make up 90% of transfers) have agreed to start checking 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 send you a notification so you can amend any errors before making the payment. These new measures will be in place by 31 Mar 2020.

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

    • Contact your bank straight away 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 note of exactly when the error was made. If you know the mistake you made (eg, 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 eg, 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.

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