TSB Enhance customer? Consider switching now as rates are to be slashed

From 4 November, TSB will slash the amount of interest Enhance customers with balances of under £5,000 can earn, from up to 3% to a flat rate of 1.5%.

In contrast you could earn up to 3% on up to £20,000 elsewhere. See our Best Bank Accounts guide for the top deals if you're thinking of switching.

Around 500,000 customers have an Enhance account, although TSB says less than half will be affected by the change as the majority of customers currently earn 1.5% anyway.

The Enhance account, which was formally known as the Vantage account, was inherited by TSB when it split from Lloyds Bank in September last year.

It was removed from sale for new customers in March, following the launch of TSB's Classic Plus account, which pays 5% on up to £2,000.

MoneySavingExpert.com's senior money writer, Helen Saxon, says: "Many bank accounts become obsolete the older they get. Banks' focus tends to be on their flagship offering, in TSB's case the Classic Plus, and these old accounts suffer from low rates and a lack of innovation.

"Fortunately, there are a raft of bank accounts out there, many paying decent interest, or switching bonuses or other perks. Switching takes just seven working days, so there's no need for you to be unhappy with your old account for long."

So what exactly's changing?

Here's how much Enhance customers who continue to pay in at least £1,000/month will earn from 4 November:

Enhance current account rates

TSB says all other features of the account remain unchanged and adds that Enhance is "still a good product for many people".

Are Lloyds customers affected?

Lloyds' Vantage account was also removed from sale in March when it launched its new Club Lloyds account paying up to 4% on balances of up to £5,000.

However customers who still have a Vantage account should also consider switching elsewhere, as Lloyds' slashed rates on 2 July meaning some now won't earn anything.

Lloyds also introduced the requirement that to continue to earn interest with Vantage, customers must now have at least two different direct debits set up on the account.

Here's what it currently pays to those who pay-in at least £1,000/month:

Vantage current account rates

What are the top paying current accounts?

There are a number of different perks currently on offer to tempt you into switching bank account. If it's an interest paying account you're after, here are our best buys:

• Santander 123: It pays 1% if you've £1,000-£1,999.99; 2% if you've £2,000-£2,999.99 and 3% if you've £3,000-£20,000. You can also earn up to 3% cashback on certain household bills, although you do have to pay a £2/month fee to get it, pay in at least £500/month and have a minimum of two direct debits set up.

• Club Lloyds: It pays 1% under £2,000, 2% from £2,000-£4,000 and 4% from £4,000 to £5,000. You will however need to pay in a minimum £1,500/month and set up at least two direct debits.

• TSB Classic Plus: It pays 5% from £1 to £2,000. You need to pay in at least £500/month and register for online banking and paperless statements, but you don't need to set up any direct debits or standing orders.

• Nationwide FlexDirect: It pays 5% on up to £2,500 in the first year, and 1% after that. You need to pay in a minimum of £1,000/month, although you don't need to set up any direct debits or standing orders.

For the full details on these accounts, as well as more best buys, see our Best Bank Accounts guide.