High interest current accounts UK 2021

Earn a juicy rate on your current account balance while still accessing your money when you need it.

Name Product Ratings Account fees Funding requirement Interest (AER) Arranged overdraft Incentive Representative example Link
Under 19s Account - Age 11-15
Finder score
★★★★★
★★★★★
User survey
★★★★★
★★★★★
£0
No minimum funding requirement
2.5% AER
N/A
Current account switch service guarantee badge
View details
OFFER
Under 19s Account - Age 16-19
Finder score
★★★★★
★★★★★
User survey
★★★★★
★★★★★
£0
No minimum funding requirement
2.5% AER
N/A
Current account switch service guarantee badge
This bank account from TSB is designed for young people aged between 11 and 18. They’ll get a TSB Visa debit card to use in shops, online or at cash machines, plus free weekly balance alerts to their mobile and regular statements to help them keep track of their money. Other benefits of the account include that it pays interest on in-credit balances and offers discounts on driving lessons with the AA. Those aged between 11 and 15 must have a parent or guardian present to open the account, but over 16s can open the account themselves. The account can be managed by mobile and internet banking, but the app must be downloaded through Family Sharing or Family Link. Over 16s can use telephone banking.
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Virgin Money Current Account - Age 18 and over
Not yet rated
£0
No minimum funding requirement
2.02% AER
19.9% EAR variable
Apply online from the Virgin Red app or website and complete a full current account switch using the Current Account Switch Service to receive 15,000 points.
Current account switch service guarantee badgeRepresentative example: If you use an arranged overdraft of £1,200 you'll be charged interest at 19.9% EAR variable.
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Club M Account - Age 18 and over
Not yet rated
£14.5 per month
No minimum funding requirement
2.02% AER
19.9% EAR variable
Apply online from the Virgin Red app or website and complete a full current account switch using the Current Account Switch Service to receive 15,000 points.
Current account switch service guarantee badgeRepresentative example: If you use an arranged overdraft of £1,200 you'll be charged interest at 19.9% EAR variable. Account fee of £14.5 per month.
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FlexDirect - Funded
Finder score
★★★★★
★★★★★
User survey
★★★★★
★★★★★
£0
Min. £1000 Per Month
2% AER
39.9% EAR variable
£100 for new accounts and £125 for existing account holders when a minimum of two active Direct Debits are switched using the Current Account Switching Service within 30 days of account opening.
Current account switch service guarantee badgeRepresentative example: If you use an arranged overdraft of £1,200 you'll be charged interest at 39.9% EAR variable.
View details
Adapt Current Account
Finder score
★★★★★
★★★★★
User survey
★★★★★
★★★★★
£0
No minimum funding requirement
1% AER
N/A
View details
123 Mini Current Account
Finder score
★★★★★
★★★★★
User survey
★★★★★
★★★★★
£0
No minimum funding requirement
1% AER
N/A
Eligible for Retailer Offers, customers must be over 16 and use online or mobile banking to qualify.
Current account switch service guarantee badge
Go to site
View details
Platinum - with Club Lloyds
Finder score
★★★★★
★★★★★
User survey
★★★★★
★★★★★
£3 per month (Account fee waived if account credit with at least £1500 per month). £21 per month
No minimum funding requirement
0.6% AER
N/A
£100 for accounts switched using the Current Account Switch Service between 7.9.21 to 19.10.21.
Current account switch service guarantee badge Account fee of £3 per month (Account fee waived if account credit with at least £1500 per month). £21 per month.
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Classic - with Vantage Account
Classic - with Vantage
Not yet rated
£0
Min. £1000 Per Month (Minimum two direct debit mandates on account per month)
0.6% AER
39.9% EAR variable
Everyday Offers - Earn up to 15% cashback from selected retailers when shopping with a Bank of Scotland credit or debit card.
Current account switch service guarantee badgeRepresentative example: If you use an arranged overdraft of £1,200 you'll be charged interest at 39.9% EAR variable.
View details
Platinum - with Vantage Account
Platinum - with Vantage
Not yet rated
£21 per month
Min. £1000 Per Month (Minimum two direct debit mandates on account per month)
0.6% AER
N/A
Free.
Current account switch service guarantee badge Account fee of £21 per month.
View details
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Although quite a rare beast these days, high interest current accounts are still a thing. Don’t expect to make big bucks (we’re talking the equivalent of three or four free dinners a year), but if you can get one, it’s definitely worth it.

The higher the rate the better, but there are a few extra tricks to compare them and make sure you get the best deal. We’ve gathered them for you.

How do high interest current accounts work?

As you may have guessed from the name, high interest current accounts are standard current accounts that also pay an interest rate on your account balance up to a certain limit.

The interest rate can be quite juicy, at least if you compare it to easy access savings accounts, but the balance limit on which it’s paid is generally low, so don’t get your hopes too high. You may also have to meet certain conditions (for example pay a certain sum into the account every month) to get the best rate.

The interest will usually be paid monthly directly into your current account.

How to compare high interest current accounts

The higher the interest, the better, right? Well, yes, but that’s not the only aspect you should take into account when comparing deals:

  • Interest rate. Top-paying accounts may reach a 5% annual rate. Sometimes. If you’re lucky.
  • Eligibility criteria. You’ll usually need to pay a minimum amount into the account every month to get the advertised rate. With some premium accounts, this limit is fairly high and may be more than your monthly salary, in which case you should probably look for an alternative.
  • Balance limit up to which the top rate is paid. A great interest rate often comes with a low limit. If you don’t have much in savings, it’s a great solution. Otherwise, you may want to see if you can get more from a competitor that pays a lower late but on a higher balance. However, don’t forget to take into account how much that extra balance could be worth in interest if kept in a separate savings account.
  • Time limit. Top rates are often just introductory offers that last a year or so. What will happen when the deal is over?
  • How much you can earn in a year. That’s the raw figure you should ultimately be looking at. It allows you to figure out which account is best, not in general, but for your particular situation.

You should also spare a thought for the features you may be giving up in return for a higher interest rate. How’s the customer service of the bank you’re considering? Is the app slick? Can you get an overdraft or a credit card if you need them? Also, in the worst case scenario, is it really worth putting up with a terrible banking experience for £100 in interest a year?

High interest current accounts vs savings accounts

Why choose when you can have both? Most savers will be better off by opening both a high interest current account and a savings account on top. It all comes down to how much you have saved and are planning to save in the near future. You should follow these steps:

  • Fill your high interest current account first. Up to the limit. Easy access current accounts pay a lower rate, so they should come second.
  • Compare savings accounts and open one. Choose the best type of savings account for your circumstances. For example, can you afford to lock away part of your savings for a while? Fixed bonds offer better rates than easy access savings accounts.
  • Regularly move money from your current account to your savings account. Once you’ve reached the maximum balance of your high interest current account, you should move any extra money you want to save to your savings account (or you won’t earn interest on it).

Alternatives to high interest current accounts

As we said, if you’re looking for an easy access savings account that pays a similar interest rate, you’re probably out of luck. However, you could consider:

  • Regular savings accounts. These are the only types of savings accounts that can compete with high interest current accounts when it comes to interest rates. They usually allow you to set aside a certain sum each month for a year. The main advantage is that your savings are kept in a separate account, so you’re not tempted to spend them. However, you usually can’t access your money until the product expires.
  • Current accounts that offer a switching incentive. When you do the maths, most high interest current accounts won’t allow you to earn more than £100 a year in interest. There are comparable switching incentives available out there, so it’s definitely an option to consider.

Be careful when comparing the interest rate and the balance limit of a regular savings account with those of a high interest current account. With the current account, you can fill the account to the limit from the very start and earn the maximum interest possible. With the regular savings account, you can only add money to it monthly instead. So even if the two accounts offer the same rate and the same limit, the current account will actually allow you to earn more.

Pros and cons

Pros

  • You always have access to your money.
  • You can find fairly high interest rates, especially compared to easy access savings accounts.
  • Great if you only have a small sum in savings, it will allow you to make the most of it.

Cons

  • You only get interest up to a certain balance limit.
  • You usually need to pay a certain sum into the account every month.
  • Savings aren’t kept separate from your day-to-day spending, so budgeting and saving can become more difficult.

Frequently asked questions

We show offers we can track - that's not every product on the market...yet. Unless we've said otherwise, products are in no particular order. The terms "best", "top", "cheap" (and variations of these) aren't ratings, though we always explain what's great about a product when we highlight it. This is subject to our terms of use. When you make major financial decisions, consider getting independent financial advice. Always consider your own circumstances when you compare products so you get what's right for you.

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