The best high-interest current accounts

Updated on 29 November 2021 | 6 Comments

Looking for a decent interest rate for your current account? We look at the best options for earning interest on your in-credit balances.

Over the last year, as savings rates have fallen, it’s become more difficult to find places to stash your cash that also offers a decent interest rate.

One savvy option could be a high-interest current account. While the vast majority of bank accounts pay little to no interest whatsoever, there are a few that actually offer even more generous rates than the best savings accounts.

But it’s worth stressing that the best high-interest current accounts are mostly ideal for small pots of cash or offer a decent rate for a limited time only.

We'll now reveal which banks will pay you a generous rate on in-credit balances.

For those who spend more of the month in the red, see our top accounts for cheap overdrafts.

Virgin Money - 2.02%

The Virgin Money current account offers a market-leading rate of 2.02% AER.

While this is limited to the first £1,000 in the account, it does come with a linked access savings account with a rate of 0.35%.

Helpfully, there's no minimum amount you have to pay in each month to qualify for the account, and you can also bag a free £150 gift card with Virgin Experience Days or 12 free bottles of wine when you apply.

Nationwide - 2%

Nationwide offers a decent rate of 2% AER on its FlexDirect Current Account and you can get up to £125 when you switch – find out more here.

The rate is fixed on balances of up to £1,500 for the first 12 months, after this time the rate falls to 0.25%, which is variable. So, in your first year, you could pocket £30 from your savings.

Nationwide allows you to hold one account in a sole name and one in a joint name, so a couple could triple the amount earning 2% to £4,500.

To earn interest, you need to deposit at least £1,000 a month into the account, but you don’t need to have any Direct Debits set up, so it doesn’t necessarily have to be your main account.

The best bank accounts for switching bonuses

Lloyds/Bank of Scotland - up to 1.5%

With the Club Lloyds and Bank of Scotland Vantage accounts, you can earn up to 1.5% AER on larger savings pots than the two current accounts mentioned above.

Both accounts feature a tiered rate, paying 0.60% on balances between £1 and £3,999, and 1.5% variable on balances between £4,000 and £5,000.

To qualify, you need to pay in at least £1,000 into your account (or at least £1,500 for the Club Lloyds account), keep your balance above £0 and set up at least two different Direct Debits.

If you pay in less than £1,500 a month into the Club Lloyds account, you’ll have to pay a £3 monthly fee.

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