The battle between the banks to attract more current account customers moved up a level this week when Yorkshire Bank (and Clydesdale Bank) launched a market- leading £150 switching incentive.
Halifax, First Direct and The Co-operative Bank already offer a £100 “golden hello” (the latter also gives £25 to charity). But a cash incentive shouldn’t be the only basis on which you choose your current account.
There is a wide range of accounts on offer, but there’s not one account that works for everybody – the best account for each individual depends on the way they run their day-to-day finances.
Some people will make regular use of an agreed overdraft limit and spend a good few days each month in the red, whereas other people always maintain a credit balance; in either case the choice of bank account should reflect this.
The £150 incentive from Yorkshire and Clydesdale runs from now until 28 February next year, but you must use the official Current Account Switching Service (CASS) and close your existing account to qualify.
The pick of the current accounts from Yorkshire Bank is its Current Account Direct, which is designed for self-service and operated via online banking or telephone.
If you have no need to visit a bank branch and have a monthly net income of at least £1,000, then this account is worth a look as the overdraft rate of 9.9 per cent EAR is one of the most competitive; the in credit rate of 2 per cent up to a maximum £3,000 is decent, too.
For those customers where credit interest is the key attraction, check the offers from TSB, paying 5 per cent AER on the first £2,000 or Tesco Bank at 3 per cent up to £3,000. But for the customer with a bigger bank balance always in the black, Santander 123 pays 3 per cent on balances from £3,000 right up to £20,000.
If a low-cost overdraft is your priority then beware of banks charging daily or monthly fees including Halifax, Barclays, Santander, Lloyds, NatWest and TSB as they can prove expensive.
More financially savvy alternatives are First Direct where the first £250 is interest free, or M&S Bank with no charge on the first £100 of an agreed overdraft. And you can move your account hassle free within seven days under the new CASS scheme.
Limited access for the less wealthy
The introduction of the Retail Distribution Review (RDR) last year may have made it clearer for investors to see how financial advisers are paid, but the downside is that some smaller investors are now considered no longer commercially viable.
A recent report from the online investment platform rplan.co.uk found that a third of financial advisers have introduced a minimum investment portfolio size since the new regulations were introduced.
This leaves many people with smaller savings and investment balances with very limited options when it comes to receiving independent face to face advice,
Stuart Dyer of rplan, said: “Investors are clearly finding it more difficult to secure financial advice, and given that our research reveals that 56 per cent of advisers are planning to stop servicing some existing client accounts over the next 12 months, the advice gap is likely to become bigger.”