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A package worth opening

A package worth opening

Category: Banking

Updated: 31/12/2012
First Published: 02/11/2010

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Are you unhappy with their current account? Have you considered the benefits offered by a packaged account?

Recent research by Moneyfacts.co.uk found that interest paid on current account balances are the latest perk to fall by the wayside for customers.

Natwest and Royal Bank of Scotland are the latest two providers to remove interest paid to current account customers.A cursory glance at the Moneyfacts.co.uk Banking Best Buys shows that more than half of the current accounts on the market pay no interest on current account balances and just under a third pay less than 0.1%.

It is the latest in a line of money saving measures that the UK's banks have taken, as new rules will insist that they have more funds in reserve should another unexpected turn take place. There is evidence that while the banks are taking with one hand, they are giving with another. However, as overdraft rates are improving, often allowing a generous interest free buffer and extra added benefits.This is particularly true in the packaged account arena.

Some people are understandably reluctant to pay for the privilege of their day to day banking – a trend that is far more common outside the UK. But the benefits on offer, including travel cover, car insurance and legal advice to name but a few, mean that for some people paying for their current account actually makes financial sense.

If you're one of those people weighing up the benefits of a packaged account, you could now 'try before you buy', so to speak.

The Co-operative Bank

The co-operative bank has introduced packaged accounts that are fee-free for the next 12 months when you switch your current account.

Privilege current account - offers benefits worth over £600 including:

  • Mobile phone insurance for up to four handsets,
  • Worldwide travel insurance
  • 20% off your first year's home insurance when you take out a policy with The Co-operative.
  • An interest and fee free overdraft of £200
Current account customers also have the choice of one of the following bundles:
  • Safeguard, traveller or gadget insurance,
  • 20% off a range of attractions and Co-operative legal service advice.

Privilege Premier current account- offers benefits including:

  • £300 interest and fee-free overdraft
  • Car breakdown cover (UK and Europe) in addition to all the benefits listed in the Privilege account above.
The Privilege & Premier Privilege accounts can be applied for online for those able to pay in a minimum of £800 a month, with a dedicated switching team ensuring all of your payments are carried over safely.

If you're still not convinced, the Moneyfacts.co.uk Best Buy tables detail the full array of current accounts and packaged accounts currently available.

They include the Halifax Current Account that pays £5 a month, perfect for those that are ruing the loss of interest from their existing account.

At the budget end of the market, Barclays offers its Current Account Plus for just £5 a month, with £213 worth of benefits including phone insurance, an interest free overdraft and extended warranty cover for your domestic appliances included.

Find the best bank account for you - compare Bank Accounts

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.