Finding out about bank account interest
When you are in credit with your bank account, the bank account provider may apply interest to your balance. This isn't always the case - especially at a time like this - and it depends on what kind of account you open.
Bank account providers decide how much interest to add to balances in credit, or to charge on overdrafts, based (to a certain extent) on the Bank of England's base rate. However, plenty of bank accounts pay little or no interest at the moment as the base rate is at an all-time low of just 0.5%.
When choosing a bank account, the interest rate is not the only thing you should look at, as there may be other features that you consider more important than the actual interest rate. When you open a thinkbanking account, for example, you'll get help with budgeting for bills, you'll avoid overdraft fees and bank charges and you'll have access to online banking and SMS balance updates.
You'll also pay a £25 set-up fee and a monthly fee of £14.50. It's important to find out exactly what you'll get - and what you'll pay - before you sign up to any kind of financial service (not just bank accounts).
The thinkbanking interest rate
The thinkbanking interest rate details are listed on the Terms and Conditions. In summary, interest will be added every month after the deduction of tax.
The interest rate is 3% below the Bank of England's base rate. This means 0% interest would be added to the account at the moment - but this will change when the base rate goes up beyond 3%.
If the base rate goes up to 5%, for instance, the account would add interest at 2% (3% below the base rate).
Easy-access bank account
Different accounts provide different services and come with different requirements. For the benefit of a high-interest account, you may have to keep your money in the account for a fixed period of time, in some cases, without access to your money at all.
Alternatively, the thinkbanking account is a current account with easy access to pay in and withdraw money. The account is also designed to make money management simpler, helping you to manage your money in a hassle-free way. Depending on your situation, you could save money in bank charges too.
Apply for your thinkmoney Personal Account now
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Tags: bank, bank account, bank accounts, interest rate