Alliance & Leicester is offering £100 to new Premier Current Account and the Premier 50 current account customers, but the offer ends on Thursday 28 May so there's not long left if you want to take advantage.
What's the deal?
A&L will give £100 to new customers who switch online to one of these accounts by 3pm Thursday, May 28. It could be a welcome cash injection if your finances are tight but there are more to these deals than just the opening incentive.
The A&L Premier Account offers some of the leading overdraft terms on the market, as it includes a free overdraft for a year on borrowing up to £2,000. Once the 12 month introductory offer ends the deal remains competitive as you are charged just 50p a day for being overdrawn up to a maximum of £5 a month. This limits overdraft charges to a maximum of £60 a year.
The in-credit rate is not the best at 0.5% on balances up to £2,500, but the £100 switching incentive means that over the first year, the returns will be better than those on many accounts which offer a higher rate of interest. Also, A&L Premier customers receive free European travel insurance.
The A&L Premier 50 meanwhile, is only available to the over 50s with a range of incentives such as worldwide travel insurance and health benefits. It matches the Premier's overdraft terms but has a more attractive in-credit interest rate at 5% on balances up to £2,500 for 12 months after which it reverts to a 1% interest rate. Balances above £2,500 earn 0.1% interest.
There is a catch, as the deal includes a £10 monthly fee, however, if you make full use of the incentives available this could be well worth paying.
What else is on offer?
While there's no denying the appeal of a £100 freebie, it's still worth comparing what else is available on the market before you apply as depending on how you use your current account, there may be a better option.
For example, A&L itself has another two attractive propositions - the A&L Premier Direct and the A&L Premier 21. The Premier Direct doesn't carry a switching incentive but it does offer the same 5% in-credit interest terms as the Premier 50 without the over 50 age restriction. This makes it the most attractive proposition on the market for those with a balance ranging from £1,501 to £2,500. The Premier 21 meanwhile is only available to those aged 16-20 and has a 5% interest rate up to £1,000 with the rate falling to 1% in the second year.
Another option for the regularly overdrawn is the Abbey Account (Preferred Overdraft Rate) which also offers a 12month interest-free overdraft. However, after 12 months you are charged a rate of 12.9%.
Another possibility is the Halifax Reward Account which works very differently to most accounts. Rather than being paid interest, customers receive a flat monthly fee of £5 (as long as they pay in at least £1,000 a month). Like A&L it also charges a daily fee, rather than an annual interest rate, for going overdrawn. However, this account is not the best option if you're regularly in the red.
The daily overdraft fee is twice that of A&L's - you'll be charged £1 per day on overdrafts up to £2,500. The charge rises to £2 a day on overdrafts above £2,500 and if you go overdrawn without permission you'll incur a daily charge of £5. And, unlike A&L, there is no monthly cap on the amount you'll be charged so if you spend most of the month overdrawn it could cost you more than £300 a year.
If you're not worried about an overdraft and are focused on finding the best rate of return for your money, then you should base your choice on the size of your balance.
For example, Lloyds TSB's Classic Account with Vantage pays 4.0% on balances between £5,000 and £7,000, making it a leading proposition if you keep this amount in your current account.
Our article 'What's the best current account?' evaluates the different options in more detail. You can also compare deals with our current account comparison tool.
Our verdict...
With its £100 switching incentive the A&L Premier Current Account is a compelling offer which will be great for many people. However, there are other good current account deals available, so it's worth considering all the options before deciding which to go for.
The key message to get across is that switching your current account is well worth doing. Regardless of whether you're usually in the red or the black, the chances are you'd be better off moving to a more competitive deal.
Disclaimer: Please note that any rates or deals mentioned in this article were available at the time of writing. Products underlined can be applied for directly.
Rate This Article
Click on a star to rate this article.
