Choose the best online banking account

The digital age has finally caught up with the staid world of personal banking, and more and more of us have opened an online banking account. Most of us have just gone along with the service provided by our branch, but should we be more choosy?

Changing bank accounts can seem an alarming process, but actually it's fairly straightforward. Your new bank will transfer all your standing orders and direct debits automatically and it's a relatively pain-free process. So that does give us the freedom to shop around for the best online account.

If you are chasing the best interest rates, comparison sites like www.moneysupermarket.com can point you in the right direction, but for current accounts, the quality of service is usually the important issue. It's worth considering customer feedback when choosing an online account.

First Direct (www1.firstdirect.com) scores very highly with customer ratings, and is commended for having UK call centres which deal quickly and efficiently with problems. In the Which survey in 2010, it had an approval rating of 82%.

Smile (www.smile.co.uk) was the first internet-only bank in 1999, and is now part of the Co-operative Bank (which also enjoys high approval ratings). It has 24 hour UK-based call centres, and a smooth and easy to understand website.

Santander (www.santander.co.uk) is still trying to climb out of a mire of negative customer feedback. In 2010, at the height of its problems after taking over Abbey National and Alliance & Leicester, it rated 47% approval in the Which survey. Judging from the frequency of its appearances in the consumer complaints columns in the national press, it is unlikely to be much higher now.

It's not all bad news for the Spanish giant though. Cahoot (www.cahoot.com), one of its subsidiaries, enjoys one of the highest approval rates from customers for its online banking account.

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