Advantages of current accounts

Written by Rebecca Goodman

Reviewed by Collette Shackleton

5 min read

Updated: 15 Jan 2025

In this guide / article

You need a current account to receive your wages and to carry out day-to-day banking. In this guide, MoneySuperMarket explains the advantages of having one.

Key takeaways

Current accounts are vital for managing your money, paying bills, and accessing cash
You can be paid your wages and any benefits you receive into your current account
Basic current accounts usually don’t charge fees
Maintaining a positive balance and avoiding overdrafts can gradually improve your credit history

What is a current account?

A current account is a bank account that gives you immediate access to your money. It stores the funds readily available to you. This money can be withdrawn as cash or spent to pay for things online, through a direct debit or a standing order.

Your debit card is linked to your current account which you can use for everyday spending and contactless payments.

What are the benefits of having a current account?

Using a current account can come with many advantages, including:

You can withdraw your money from your current account whenever you need it. Some savings accounts, for example a notice account, will require you to lock your money for a set period of time.

Whereas, you will be penalised for dipping into your regular savings account before the fixed term is over. Your current account provider won’t charge you for using your debit card for cash withdrawals.

You’ll need a current account to be paid your salary by your employer. A current account is also necessary when you want people to send you money, e.g., your friend needs to pay you back and they need your current account details to transfer you the funds.

It will also be the place where any benefits you receive are paid into, such as child benefit or the state pension.

You’ll need a current account to set up regular payments such as direct debits and standing orders. If you need to send someone money, then you’ll have to do it from your bank account.

If you make sure to stay in credit with your current account and avoid slipping into your overdraft, you could gradually build up a strong credit history.

Try to not go over your arranged overdraft limit, as doing so can hurt your credit score. You can also use direct debits from your bank account as a way to keep up with your credit card payments, which will help boost your credit rating.

Current accounts with banks and building societies are protected by the Financial Services Compensation Scheme(FSCS). Meaning, if anything happens to your bank, then you will be covered for up to £85,000 or £170,000 for joint accounts.

Quick access to money

Receiving payments

Making payments

Help credit score

Protection

Are there any fees associated with current accounts? 

You could face the following charges with your current account:

Monthly and annual fees: If you have a standard current account, it’s unlikely you’ll be charged to use it. However, you can expect monthly and annual fees with packaged bank accounts, high-interest and reward current accounts.

Foreign transaction fees: If you use your debit card overseas you could be charged for doing so. However, challenger banks are noted for offering fee-free debit card spending abroad.

Overdraft: You can be charged a fee for using your overdraft, this is usually a daily flat fee until your account is back in credit.