Many people get a bank account when they are young, maybe chosen and set up by their parents, and then keep using it for the rest of their life, never considering a change. Providers count on this loyalty, which is why you won't often find incentives added to your current account for free. If you want to get more out of your everyday banking, your best option is usually to switch.
Now, you may have recently seen an advertisement from a bank or building society offering a switching incentive, such as £100, for moving over to them. While certainly tempting, it's important to consider the whole package before actually switching. If you can get 5% interest every year for the foreseeable future, this will likely end up being worth more than a one-off £100, especially if the account with the switching incentive comes with a monthly fee and the alternative doesn't.
There’s every chance that high interest accounts will offer higher rates than savings accounts. However, even if current accounts offer lower rates, there's still something to be said for using your current account as a high interest savings account. For one, the highest paying savings accounts -typically fixed rate bonds - tend to require you to set your funds aside for a long time, with no early access. A current account will generally allow unlimited easy access, as long as you fulfil the funding requirements.
Given that high interest accounts will only offer interest up to a certain amount, they are not convenient for stashing large amounts of money. A fixed rate bond as well as a competitive current account might be the best way to go.
If you've decided to switch to a high interest current account, remember that the provider will run a credit check, so make sure your credit score is up to scratch. With every credit check slightly reducing your credit score, you may also want to think twice about opening multiple high interest accounts, especially if you're planning to apply for a mortgage soon.
Once you've decided on a current account, and you're sure you fulfil all the eligibility requirements, the process should be straightforward. Check if the bank or building society you're looking to switch to is part of the Current Account Switch Service. This service guarantees that your account, including all your direct debits and standing orders, is switched over within seven days. Almost all providers will offer this nowadays, so you shouldn't have to do anything after your application has been accepted except wait for your new card and banking details.