MoneyExpert.com: Abbey's new 8% current account

Sean Gardner, Chief Executive of MoneyExpert.com, said: “Our Switching Index shows current accounts are the new switching battleground, with some 2.29 million people ditching their bank in the last six months to April. So the launch of any current account with a rate of 8% is to be welcomed. Clearly plenty of us are fed up with our banks and are prepared to vote with our feet.

“That said, this new account is something of a gimmick and customers should see it as that. The great rate only lasts for a year and customers have to remember that.

“The preferred in credit interest rate will drop to 2.5% after the year is up and that rate is easily beaten. There are some 29 different accounts from 14 providers with a better gross rate, even with a £1 balance.

“The average rate on all current accounts with a starting balance of just £1 is 1.8%. There are also just as many accounts paying over 1% interest as there are paying less than 1%, so there’s really no excuse for sticking with a bank that pays poorly.

“Abbey aren’t shy about targeting this account at switchers, so if you do take advantage of the headline rate, our advice would be switch – but switch again at the end of the year unless you find other reasons to stay.”