Product Description
Current accounts are the day-to-day bank accounts that people use for their finances. They generally come with a debit card or cash card and on occasion you’ll get a cheque book as well – although these are becoming rarer because of their decreased use. Most current accounts also have an overdraft facility attached, plus they have the ability to handle direct debits and standing orders.

The Main Players
The majority of current accounts are still held with the four major high street banks – Barclays, Natwest, HSBC and Lloyds TSB. The building societies are also starting to become popular though and the main ones include Abbey, Alliance & Leicester and Halifax.

Pros of Current Accounts

• You can do all your banking from the single account as they accommodate direct debits, standing orders and BACS payments.
• You get a cash or debit card which means you can access your money at any time of the day and from anywhere there is a cash machine.
• These accounts generally come with an overdraft facility which means you have a life line should you get a short of cash towards the end of the month.
• Most current accounts can now be managed online so you can check your balance of pay bills from home.

Cons of Current Accounts

• They don’t pay great interest rates – the average is around 0.1% when you’re in credit.
• Overdrafts often have interest charges attached and these can reach upwards of 15%. Plus they get higher if you exceed your overdraft limit.
• The current accounts with higher rates of interest often require you to deposit a set amount each month to qualify. If you don’t earn that much then you don’t qualify.

Things to Consider when Choosing a Provider
Most of the regular current accounts from the top four banks pay very similar interest rates and so you should look at the benefits you get with the account. Some offer an interest free overdraft up to a certain level and if you constantly use your overdraft then this is worth looking at. You should also look at their regular overdraft charges – just in case a crisis occurs and you desperately need money you don’t have. Another thing to consider is the availability of customer services should you need to contact them at any time. Banks and building societies with a direct phone line are more preferable to those with 0800 numbers.

Building societies tend to offer slightly better interest rates than the banks but they may not grant an overdraft with some of their accounts. In this case you need to decide if you are normally in credit or debit and use this information to make the choice. Building societies also often stipulate a minimum deposit each month so you have to make sure you can meet this figure regardless – otherwise you loose your preferential interest rate.

BUYability Summary
Virtually everyone in the UK has a current account of some kind for their day-to-day banking needs. There are over 100 products to choose from, some of which have higher interest rates while others have better benefits. You need to make a list of what you want from a current account and narrow the field down – otherwise you’ll be searching the options for days on end.