Imagine having more than £110,000 sitting in a bank account that pays you absolutely nothing. According to analysis by savings provider Spring, over one million Brits are doing exactly that – leaving an average balance of £111,537 in current accounts earning zero interest. In total, that's £116 billion languishing unused. Based on the average one-year fixed savings rate of 4.23%, a saver with that typical balance is missing out on nearly £4,700 a year.
The problem stems from the fact that 87% of the UK's 91 million current accounts in credit – around 79 million accounts – offer no interest whatsoever. While many high street banks pay zero or minimal interest on current account balances, they use those deposits to fund lending through mortgages, personal loans and credit cards, where borrowers face much steeper charges. This gap between what banks earn from loans and what they pay savers has boosted bank profits significantly. Lloyds Banking Group reported pre-tax profits of £6.7bn for 2025, up 12%, while NatWest posted £7.7bn, a 25% increase.
“Explains why over one million UK savers have zero-interest current accounts and how to switch.”
Why do so many people leave money in these accounts? Spring's survey found that 36% keep their savings with their main current account provider, and 21% leave savings sitting directly in their current account. Habit, uncertainty and confusion are the main barriers. Derek Sprawling, head of money at Spring, said: "Often, it comes down to convenience or habit, but with balances of £50,000 or more, the missed returns can be significant." The cost of inaction is compounded by inflation, which currently sits at 2.8% – meaning the real value of cash erodes if it earns no interest.
For UK readers, the practical impact is clear: moving money to a better-paying account can make a real difference. According to Moneyfacts, the average easy-access savings account pays around 2.5%, while a one-year fixed-rate account offers on average 4.23%. That means on a £50,000 balance, you could earn over £2,000 a year in interest by switching. Even smaller sums benefit – the key is to check what your current account pays and consider moving surplus cash into a savings account.
Q: How can I check if my current account pays interest? Look at your bank statements or online banking. Most high street current accounts pay zero interest on balances, but some offer a small amount. If you have more than a few thousand pounds sitting there, you're likely missing out.
Q: What are the best alternatives for my savings? Easy-access savings accounts currently pay around 2.5% and allow you to withdraw money anytime. One-year fixed-rate accounts pay about 4.23% but lock your money away for 12 months. Compare rates on comparison sites like Moneyfacts.
Q: Why don't banks pay more interest on current accounts? Banks profit by lending out deposits at higher rates. They have little incentive to pay interest on current accounts because many customers don't switch. The big banks have reported rising profits – Lloyds £6.7bn and NatWest £7.7bn in 2025 – partly due to this low-interest deposit funding.
What happens next? The figures renew debate about whether banks are fulfilling their obligations to savers. With inflation at 2.8% and many accounts paying zero, pressure may build for regulatory action or more competitive offerings. In the meantime, savers who shop around can secure much better returns, and the cost of staying put continues to rise.