Most UK adults have held the same current account for years, or in many cases, decades. The Current Account Switch Service (CASS), which guarantees a seven-working-day switch with all payments automatically transferred, has made changing banks straightforward — yet switching rates remain relatively low. This is partly inertia, partly a reasonable suspicion that all banks are broadly similar. On some things, they are; on others, the differences are meaningful.
Monthly Fees
Standard current accounts at the major high-street banks — Barclays, Lloyds, HSBC, NatWest, Santander — are typically free to hold. The free account tier comes with standard services: debit card, online banking, branch and phone banking access, and standard overdraft facilities.
Premium or packaged accounts charge a monthly fee (typically £10-£25) and offer benefits such as travel insurance, breakdown cover, mobile phone insurance and higher interest on credit balances. These accounts represent good value if you would otherwise buy the included products separately; they rarely represent good value otherwise. Calculate the actual cost of the individual products before committing.
Challenger banks — Monzo, Starling, Revolut — offer free standard accounts with some advantages over traditional banks on things like spending notifications, fee-free overseas spending and savings pots. Their overdraft facilities and complaint handling have matured considerably since their early years.
Overdraft Rates
Following FCA intervention, overdraft pricing was overhauled in 2020. Banks can no longer charge fixed daily fees for overdraft use; all overdraft charges must be expressed as a simple annual interest rate (APR) for comparison purposes.
In practice, most major banks charge between 19.9% and 39.9% EAR (Equivalent Annual Rate) on authorised overdrafts. This sounds alarming, but the actual cost for occasional, brief overdraft use is small — a £100 overdraft for seven days at 39.9% EAR costs approximately 75 pence.
| Bank | Authorised overdraft EAR | Interest-free buffer |
|---|---|---|
| Barclays | 35.0% | None on standard accounts |
| Lloyds | 39.9% | £25 interest-free |
| HSBC | 39.9% | None on standard accounts |
| NatWest | 39.49% | £10 buffer |
| Monzo | 19%–39% (varies) | £20 buffer on Plus/Premium |
| Starling | 15%–35% (varies by credit) | None |
Fraud Protection and APP Scams
Authorised Push Payment (APP) fraud — where customers are tricked into sending money to fraudsters — is a significant and growing problem. From October 2024, the Payment Systems Regulator (PSR) introduced mandatory reimbursement rules: banks must reimburse victims of APP fraud in most circumstances, up to £85,000 per claim.
The reimbursement is split equally between the sending and receiving bank. Both banks are motivated to improve fraud detection and customer warnings. In practice, reimbursement outcomes still vary — claims can be contested on grounds of gross negligence by the customer — but the new rules represent a significant improvement in consumer protection.
When choosing a bank, it is worth checking its APP fraud complaint and reimbursement record. Which? publishes regular reports on bank fraud performance.
How to Complain Effectively
If you have a dispute with your bank, the process has clear steps:
- Formal complaint to the bank: Submit in writing (email or letter). The bank has up to eight weeks to resolve the complaint.
- Financial Ombudsman Service (FOS): If the bank's response is unsatisfactory, or if eight weeks have passed without resolution, you can refer the complaint to the FOS free of charge. The FOS can award compensation and direct the bank to take corrective action.
- Financial Services Compensation Scheme (FSCS): If a bank fails entirely, deposits up to £85,000 per person per institution are protected by the FSCS.
Switching Made Easy
The Current Account Switch Service (CASS) at currentaccountswitch.co.uk guarantees a seven-working-day switch, including automatic redirection of all payments. If anything goes wrong during the switch, the guarantee covers any charges you incur as a result.
The best current account for most people is the one with the lowest effective cost for their actual usage pattern — which means considering overdraft rates if you occasionally dip into an overdraft, monthly fees only if the benefits genuinely match your needs, and fraud protection record if you handle significant sums. Switching is free, fast and fully reversible; the inertia of staying with an account that doesn't serve you well is rarely justified.