Do banks offer better savings rates if you have a current account with them?

Some banks do offer their current account customers a better deal on savings, but not always by much. In this guide, we’ll explain what to look out for. If you want a broader overview first, our current accounts guide covers the different types of current account and what to look for when comparing them. 

The quick answer: sometimes, but not always

A handful of banks do offer preferential savings rates or bonus interest to customers who also hold a current account with them. But it’s always worth comparing what else is out there before assuming your bank’s savings deal is a good one just because you’re already a customer.

How banks use current accounts to offer savings rates

Bundled banking packages

Some banks bundle savings perks into their current account: a higher rate on easy access savings, interest on your everyday balance, or exclusive savings products for current account customers.

Biscuit, Zopa’s free current account, is a good example. You earn 2% AER* (1.98% gross**) variable on your current account balance with no balance cap. You also get exclusive access to Zopa’s Regular Saver. Save up to £300 a month and watch your Regular Saver pot build at 7.10% AER* (6.87% gross**) variable for 6 months. It’s a separate product, free with Biscuit, with no monthly fee or obligation to open it. 

Account loyalty rewards

Some banks reward long-standing current account customers with better savings rates as a loyalty perk. It’s a nice idea, but a loyalty rate isn’t always the most competitive – worth checking before you assume you’re getting a good deal.

Premium current account tiers

Premium current accounts (those with a monthly fee) sometimes include higher savings rates. The question is whether the interest you earn outweighs the monthly cost – at £15 a month, you’d need a substantial balance to make it worthwhile.

What is a linked savings account?

A linked savings account is a savings account held at the same bank as your current account, connected so that moving money between them is usually instant. You can top up or dip in without any waiting around. Most are easy access, though some come with a notice period or fixed term.

It’s worth knowing that linked and bundled mean different things. A linked savings account simply means your savings and current account sit at the same bank and are easy to manage together. An exclusive savings product, like Zopa’s Regular Saver, is different – it’s a separate account available only to Biscuit customers, not a feature that’s automatically attached to the current account.

Comparing linked savings vs. standalone savings accounts

Advantages of linked savings accounts

The main appeal is convenience. You can see your current account and savings balance in one place, transfer money instantly, and manage everything through a single app or online banking portal.

When standalone savings accounts may suit you

A standalone savings account, one held at a different bank to your current account, can sometimes offer stronger rates. That’s especially true for fixed term products, where you’re willing to lock money away for a set period. You can open one with any bank, regardless of where your current account is. Zopa’s Smart Saver offers easy access pots, notice pots and fixed term pots, all in one account.

How to calculate real returns

Before committing to any account, it’s worth doing a quick calculation. Take the AER on offer, apply it to your actual balance, and work out what you’d earn in pounds over 12 months. Then do the same for the best rate you can find elsewhere.

When bundled banking has hidden costs

Fees vs. what you earn

Not all bundled savings benefits are genuinely free. Premium current accounts can charge anywhere from £5 to £25 a month. If a better savings rate is the main reason you’re paying that fee, it’s worth running the numbers.

Use the AER when comparing. It’s the standardised figure that shows what you’d earn over a full year, regardless of how often interest is paid. The Financial Conduct Authority (FCA) recommends using AER as the fair way to compare savings accounts, and its savings calculator is a useful tool.

As a quick sense check: if a fee-linked savings rate is only 0.2% higher than a free alternative, you’d need a £90,000 balance to earn enough extra interest to cover a £180 annual fee. For most people, that maths rarely works out.

Minimum balance requirements

Some banks require you to keep a minimum balance, in your current account or your linked savings account, to access the improved rate. Falling below that threshold can mean losing the rate advantage entirely. Check the eligibility conditions before you open an account.

Which banks offer savings interest on current accounts?

Some UK banks, including Zopa, pay interest directly on your current account balance, so your everyday money earns a return without you needing to move it anywhere. With Biscuit, that’s 2% AER* (variable), with no minimum balance and no monthly fee.

Not all banks do this, and the rates on offer vary widely between providers. It’s worth checking your current bank’s terms to see whether your balance is earning anything – you might be surprised.

Are savings accounts with my bank better than switching?

You can open a standalone savings account with any bank or building society, regardless of where your current account is. That gives you the flexibility to put your money wherever the rate suits you best.

That said, there are genuine benefits to keeping things simple. Having your current account and savings in one place means a clearer picture of your finances and less to manage. The key is making sure the rates are competitive – not just convenient.

Tips for getting the best savings rates

Compare before you open

Before opening a linked savings account with your current bank, it’s worth doing a quick check on what else is available. Comparison sites like MoneySavingExpert are a useful benchmark. We’re chuffed that Biscuit is top-rated by them for cashback, perks and regular savings.

Get more from your savings in one place

You don’t need to use multiple banks for different types of savings. With Zopa, you can earn interest on your everyday balance with Biscuit, then set money aside in an easy access, notice or fixed term Smart Saver pot – all in one app.

Keep an eye on your rate

If your account isn’t fixed term, savings rates can change, so it’s worth checking in every few months. If you’re on a strong rate now, make a note of when any introductory period ends. MoneyHelper’s savings guidance has practical advice on staying across what your savings are earning.

Key takeaways

• Whether your bank’s savings rate is competitive depends entirely on how it compares to what else is out there

• Linked accounts are convenient, but convenience isn’t the same as good value

• Fee-paying accounts only make sense if the interest you earn covers the cost

• For the strongest rates, specialist providers usually beat loyalty – though Zopa gives you both, with interest on your everyday balance alongside a full range of savings.

Ready to make your money work harder?

Biscuit by Zopa is a free current account that earns you 2% AER* (variable) interest on your everyday balance, 2% cashback on up to £125 of Direct Debits per month, and exclusive access to Zopa’s Regular Saver at 7.10% AER* (variable ), only available to Biscuit customers. Find out more about Biscuit.

*AER stands for ‘annual equivalent rate’. We pay you interest on a monthly basis, but AER shows you the rate you’d get if this monthly interest was compounded and paid once a year instead. We provide an AER to make it easier for you to compare our rates with other providers.

**We pay gross interest, which means nothing is deducted for tax. ‘Variable’ rate means the interest on your Regular Saver pot can go up or down. We may review it when the Bank of England base rate changes and we’ll always let you know if we make any updates.