UK government really needs your money

They're paying more interest than the "private" banks, in spite of the fact that your deposit is 100% secure with an explicit government guarantee.

For example, my kids have Halifax Save4It accounts. This usually pays a decent interest rate, as its specifically a kid's savings account. I suppose money in these tends to stay put for a long time -- anyway, banks tend to pay better interest on savings for children, whatever their actual reasons might be.

But I note with interest that now a regular NS&I savings "income bond" instant access savings account, is paying 1.7% interest and it pays out the interest monthly. Meanwhile even my kids can only get 1.05% from their Halifax Save4It account, which pays out annually and doesn't have an explicit government guarantee.

Suffice to say, it looks attractive to open one of these accounts for each for my kids now, and shift their cash over. If enough people think the same thing (which is likely) Lloyds-HBOS and all the other banks with similarly unattractive offerings, will see a serious outflow and may well find they are once again in dire need of capital because they have insufficient reserves.

ALL THE MORE REASON TO DO IT NOW THEN...