Banks not increasing current account rates
New research from Moneyexpert.com reveals that 2 out 5 current accounts still pay less than 1 per cent interest when you’re in credit. In the current economic climate with savings accounts offering 6 per cent and more this just isn’t good enough.
According to Moneyexpert.com the latest average interest rate on a current account is just shy of 2 per cent compared to an average of 1.6 per cent 12 months ago. Moneyexpert say that the banks should be doing more to reward customers who stay in credit and that too many current account providers just don’t offer competitive interest rates for their customers. This is something I definately agree with; how can savings and fixed rate bond fixed rate bond accounts be attracting customers in with 6 to 8 per cent headline rates but at the same time paying out absolute peanuts in current account interest? Lets face it the majority of people over the next year or so will not be able to afford to save any additional money. The credit crunch is really kicking in and inflation is set to be at it’s peak.
Director of MoneyExpert.com, Sean Gardner, said: “It’s encouraging to see banks getting their houses in order and offering better interest rates for customers with positive balances.”
“But let’s be honest - almost half of all accounts reward customers who are in the black with less than one per cent annual interest. That’s an appalling return. Given there are accounts out there offering ten times that amount of interest, customers should not settle for a raw deal.”
“3.57 per cent is a healthy average for accounts paying above one per cent, so every customer should aim to find an account with a similar or higher rate of interest.
“This is of course not forgetting the importance of customer service and other perks - we wouldn’t necessarily recommend buying purely on price for your current account as it’s not just the account but the bank that you’re buying into. You need to be sure it’s the right place for your money.”
So go for an account with 3.57 per cent or more on offer, but make sure you satisfied with the customer service before you switch! I chose the bank I’m with because I know their online banking is second to none; therefore I knew I could do all the banking I needed without having to ever go near a branch! And this for me makes for a good relationship with my bank! That coupled with the fact I don’t have to speak to their call centre…
>>Click here to compare current accounts and apply online today
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