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Banks don't want our money...

July 2016

Stacks of decreasing Pound coins...but they do want our business.
Loans, mortgages, debit and credit cards and insurance are lucrative earners for Banks but, with cheap money available through the Government and Bank of England, they don't have to rely on our money to finance and support these services. So not needing our money means Banks can dump savings interest rates to their lowest levels ever. Of course though, if they are not tempting us in with savings deals how are they ever going to be able to sell us that loan, mortgage or any of the other money spinning services they offer. Step in interest paying Current Accounts... the new savings accounts. They offer us inviting teaser rates of 3 - 5% to entice us in. However this rate is usually only available on relatively low balances of up to £2000 to £5000, the exception being Santander who offer 3% on £3000 to £20000, bizarrely they then take £5 a month (£60 a year) off of you in a compulsory fee! There are usually conditions attached to these Current Accounts such as paying in a minimum monthly amount and setting up direct debits. However Tesco Bank comes without these conditions or fees. You can literally put £3000 in their Current Account and get 3% interest without doing a thing... except to remember to move out the interest each month. As with all these interest paying Current Accounts no interest is paid on amounts over a maximum threshold, and that's £3000 at Tesco Bank, so move that interest to some other interest paying account. If you're not sure which one, or to compare interest paying Current Accounts check out our Top Rates tables.


(Administrator) BlogMan update :
Note: Santander has given notice that the interest rate of their popular 1|2|3 Current Account is being halved from 3% to 1.5% from 1 Nov 2016. Make sure you switch to a higher paying account by checking our High Interest paying Current Accounts table.

(Visitor) Tony commented :
Banks, bailed out and/or given access to easy cheap money, and what have they given back to the tax payers who've part funded it ? Record low savings rates and complicated current accounts!

(Visitor) Helen commented :
Savings interest just keeps on going down and down. I've opened 5 current accounts to keep my savings in so as to earn a reasonable return. It was a challenge setting it all up but now its done it more or less looks after itself. Good point you made about the interest though. Each month I put all interest in a TSB monthly saver paying 5% for a year. Interest making interest :)
(Administrator) BlogMan replied :
Note: TSB Monthly Saver rate has now dropped to 2% for accounts opened after 30.06.2016

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