Lloyds TSB has announced that it will pay interest of up to 6% on its Plus account.
It said anyone who opted for a Plus account before July would receive a 2% bonus for 12 months, giving a total rate of 6%, after which it would revert to the standard rate which is currently 4%.
To qualify for a Plus account, customers need to pay in at least £1,000 a month, with the 6% rate paid on balances of up to £2,500.
The deal is available to both new and existing customers who upgrade their accounts to Plus ones.
The Plus account can be taken out on a Classic current account which does not have a fee, or one of the group’s Gold, Platinum and Premier packaged accounts which have fees ranging from £12 to £25 a month.
Which? senior researcher Cathy Neal said: ‘This deal offers a good rate of credit interest to anyone who signs up before the deadline but the Lloyds TSB current account is not a Which? Best Buy as it charges high interest rates for overdrafts and scores below average in our customer satisfaction survey.’
Lloyds TSB has also set up a dedicated switching service to help people who want to move their current account to it.
The service will arrange the transfer of all standing orders and direct debits, and will liaise with employers and pension providers to co-ordinate the transfer of funds to new accounts.
Lloyds’ decision to increase the interest it pays on credit balances in Plus accounts comes just a month after the group announced it was increasing charges for some of its packaged accounts by £2 a month.