Average credit interest AER on all current accounts: 1.94%
Average credit interest AER on all current accounts paying over 1%: 3.52%
Proportion of accounts paying over 3% AER on credit interest: 29%
Sean Gardner, director of MoneyExpert.com, said:
"Lloyds TSB’s 6 per cent interest on its Plus Account reignites the current account price war and represents excellent value for bank customers who keep £2,500 balances in their accounts."
"Competition in the current account market has been muted recently as banks have held fire so it’s good to see new signs of life. And importantly the offer is open to new and existing customers, so it’s not just a way of winning new business."
"Across the market as a whole the average credit interest paid is just 1.94 per cent although if you ignore those paying a miserly one per cent or less then the average is 3.52 per cent. That should be the new benchmark for current account customers."
"Banks want to attract customers with cash to save but that doesn’t help customers who spend most of their time trying to stay out of the red. In the current climate anyone who can maintain a healthy bank balance is of interest to the banks – and the rest aren’t."