Bank warning issued to anyone with £10,000 in savings

Millions are missing out on hundreds of pounds a year in interest by making a costly mistake - leaving large sums of money idle in their current accounts.

New analysis reveals that some 8.3 million current accounts in the UK hold £10,000 or more, yet a staggering 80% of these accounts pay no interest at all.

In total, these accounts are sitting on £284 billion, money that could be earning a significant return if moved into high-interest savings accounts.

The figures come from Spring, a new savings app that uses Open Banking technology to link directly to customers’ current accounts.

It says its product offers 4.30% AER, far higher than the typical offerings from the high street banks. The company found that one in 11 current accounts - based on CACI industry data — hold balances averaging £33,961, with some 1.3 million accounts containing more than £50,000.

Spring warned that millions of account holders are what it terms ‘current account coasters’ - people who leave surplus money languishing in their main account after bills and essentials are paid, rather than transferring it to a savings product.

Further industry-wide figures show 74 million current accounts that are in credit are earning no interest at all.

Derek Sprawling, Spring’s Managing Director of Savings, said: “Cumulatively, nearly £400 billion is held in current account balances in the UK.

"You would imagine that these would mainly consist of small balances, but our analysis shows that there are a significant number of accounts that contain sizeable funds, accounting for over half of the overall balance.

“Most people sensibly maintain a small current account balance to cover emergency costs and everyday expenses, but leaving thousands of pounds in your current account means you will be missing out on hundreds of pounds in interest each year.

"With nearly eight million current accounts containing significant balances, that money could work harder in a higher-paying savings account.”

He added: “Many people don’t move those funds because they don’t want to lose access to it but choosing a savings account that connects to a current account so you can transfer money in seconds and offers unlimited withdrawals, could provide a compelling alternative.”

Spring’s app - available on iOS and Android — allows users to apply within minutes and link their accounts for instant access to savings features, including separate pots and easy withdrawals. It requires no bank switch and promises to help people develop better savings habits with minimal effort.