3 minutes reading time (549 words)

Supermarket sweep: should I move my current account?


shopping 1165437 640I am a bit of a supermarket tart: I go to whichever suits my needs, finances or whereabouts. So, that means Sainsburys if it’s hot outside: our local branch is so cold it’s the place to be in a heatwave; Morrisons if I am feeling a bit poor and can bear negotiating the narrow entrance to its car park; Waitrose if I’m nearby:  I get points on my John Lewis credit card plus a feeling of moral superiority in turning down the free coffee  and Asda: very rarely and usually for the cheap fuel. But I mostly go to Tesco because it’s near the boy’s school and at 8.30am it’s quiet and well stocked.

Now there’s a new deal from Tesco – and one potentially worth much more than any two for one deal on toilet roll. The supermarket’s bank has just reopened applications for its current account which pays a massive 3% interest on credit balances (the rate is variable but Tesco says it will maintain it for two years). Tesco first made this offer in February but had to close to new customers within days thanks to huge demand. Now it has added conditions for those now applying for the account – you have to pay in at least £750 a month, have at least three direct debits each month and you get the 3% interest on balances up to £3,000. These conditions are I imagine in place to stop people opening the account and treating it as a savings account rather than a transaction-based current account.  

Of course, 3% is a great rate – it’s above the current rate of inflation of 2.3% unlike nearly every other account, savings or current, you could find. But I’m not going to bite, even though you also get Clubcard points when you use the debit card. Trying to keep to the conditions would really mean using it as my main current account: I don’t think I have enough money coming in nor am organised enough to balance two current accounts. And actually, I don’t want to close my current account which pays nothing on credit balances. I don’t leave much money in my current account anyway so even at 3% I wouldn’t get a great deal of interest. And while I know that these days swapping a current account is much easier than it used to be, I’m happy with my bank. I’ve been with it since I went to university back in the last century and amazingly, it’s never made any error serious enough to make me want to go elsewhere. It also handled my last problem (when I was targeted by online fraudsters) really well and if I phone up, I get to talk to a real person. I’m sure Tesco Bank would be fine but it was only last year that it was hit by a cyber- attack when 9,000 of its customers had money taken from their accounts. So I’m staying put: although I might lose interest, sometimes there are more important things to consider.

PS I’m not telling you where my current account is because I’m wary of disclosing details which could make me the target of fraudsters (although I’m probably being too cautious).

See our Quick Guide to swapping bank accounts

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Saturday, 20 April 2019