What is a packaged current account?
A packaged current account is an account that will offer you perks such as insurance, breakdown cover, cashback on certain bills, free overdrafts, store discounts or exclusive interest rates paid on your savings. Often you will have to pay a monthly or annual fee for the account (or have to deposit a minimum sum each month), but if you use all the benefits a packaged account can more than pay for itself.
What benefits can I enjoy with a current account?
The main reason to get a packaged account is to take advantage of the free benefits that come with the account. You could enjoy:
Insurance - Many accounts offer home and travel insurance, however, make sure to read the small print of any insurance policy to see if it covers you for your requirements.
Discounts - Many banks have partnerships or deals with high-street retailers and will give you exclusive discounts, bank accounts provided by retailers often will include a scheme paying loyalty points for spending in-store.
Breakdown cover – You can enjoy roadside breakdown support with membership of organisations like Green Flag, the AA and RAC with some current accounts.
Airline rewards – This benefit is more commonly found with credit cards, but with some bank accounts you can earn Avios points, Virgin Miles or other airline rewards as you spend.
Cashback – Some accounts will give you back a percentage of your spending as cash as a reward.
Higher interest rates – Some accounts pay higher than typical AER, but often this will only be paid on balances up to a limited amount.
Is a packaged current account worth the fee?
It all depends on how you’re going to use the account, if you think you’re going to spend in the right way to get cashback, or use the discounts, deposit large enough balances to enjoy higher interest rates, or need the insurance cover, then a packaged account will be worth paying a fee.
However, you should always consider free alternative accounts as many will offer free benefits.
It goes without saying that you should make sure you are using any account you are paying for, or you will be left out of pocket.
Packaged accounts and mis-selling
A few years ago packaged accounts came under scrutiny and it was found that many people had been mis-sold a packaged account and were entitled to compensation. If you think you were mis-sold an account you should complain to your bank or the Financial Ombudsman Service.
Packaged account mis-selling can include:
Being told you need the account to qualify for a loan, mortgage or other product
Being told a previous loan or credit application may be unsuccessful unless you also get a packaged account
Being wrongly informed of discounts you can get
If the fees were raised without you having been clearly informed
Being told it’s the only way to get an overdraft
Being told it will improve your credit score (without making reference to free alternatives)
What does 'most popular' mean?
Bank accounts on this table are ranked by popularity, which we have judged according to how many clicks they got over the past 48 hours. Those with the most clicks are at the top of the table, and those with the least at the bottom.
However, the most popular account might not be the account for you. You should still take time to filter and search all the accounts listed to see if there’s one that better fits your needs.
Which banks does Uswitch's comparison include?
We compare current accounts from a wide range of high street banks and newer challenger banks. Compare our current account providers to check which ones we include.