Which? rates Metro Bank current accountsWhich? experts analyse how the new deals compare

29 July 2010

Metro Bank

Metro Bank aims to open 200 branches within 10 years

Britain's newest bank, Metro Bank, launches today and offers a selection of current accounts, a no-fee credit card and a one-rate personal loan. Here, Which? experts give their opinion on the new products and how they stack up.

Current Account

What Metro Bank claims: Accounts opened within 15 minutes. Standard overdraft rate of 15%. Over-50s get a free Safe deposit box for the first year with a current account.

Which? verdict: The main current account doesn't pay interest, so customer service is going to be key. Purchases that take you over your credit limit will incur a £15 charge, while unpaid items will attract a £5 charge. We'll publish further details of how these charges will be applied in practice when we receive further information.

Cash Account

What Metro Bank claims: An account that can't go overdrawn, helping customers to manage their money. A MasterCard debit card gives access to money anywhere any time.

Which? verdict: In effect this is a basic bank account. It's pleasing to see Metro Bank offering these accounts as they can offer a route back to mainstream banking for those with a less-than-perfect credit history, or for under-18s looking for their first account.

Metro Bank Plus

What Metro Bank claims: A £12.50 per month account offering worldwide family travel insurance, mobile phone insurance for up to 2 phones or smart phones (including iPhones), RAC roadside breakdown service and Identity theft support.

Which? verdict: As with all , make sure you'll use enough of the benefits before you sign up and check that you can't buy the individual components cheaper elsewhere. A Best Buy annual travel insurance policy, for example, could cost around £40. One unique aspect of the Metro Bank account is a spare-keys service designed specifically for Londoners - the bank holds a spare set of your house and car keys and commits to get them to you within two hours if you need them.

Credit Cards

What Metro Bank claims: A no-fee credit card with a standard APR of 13% for all successful applicants. The same APR applies to all purchases, balance transfers and cash withdrawals, with no fees.

Which? verdict: A refreshingly straightforward, great all-round credit card for anyone wanting to carry only one card with them. You'll have to have a Metro Bank current account to get the credit card though.

While better deals can be found elsewhere offering long 0% purchase and 0% balance transfer periods, the simplicity of this card is that there are no nasty surprises. The 13%-on-all-transactions concept means you won't be hit with sneaky charges, nor will your interest rate suddenly rocket at the end of a promotional period.

Cash withdrawals attract interest from the day of transaction, but the rate is significantly lower than competitors' cards, and it doesn't charge the extra fees imposed by other providers.

Personal Loans

What Metro Bank claims: All customers pay one fair rate of 10% APR. The end to 'computer says no' - local lenders make local loan decisions.

Which? verdict: Not far off the rates offered by Which? Best Rate personal loans. The flat rate of 10% is much lower than many other high street banks and the absence of risk-based pricing means that, if your application is successful, you'll get the advertised rate.

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