The banks make billions of pounds out of us every year, a fact that is particularly hard to stomach when we know how much they pay their executives and traders.

To lessen the pain, we have come up with our five top tips for minimising the amount you personally donate to the banking industry every year.


1. Switch your current account
The big banks offer some of the worst current accounts on the market, and make millions of pounds in profit every year by doing so. And yet the huge majority of consumers do nothing to fight back.

Research shows that we are more likely to get divorced than to change our current account, even though there are some great deals available and the switching process has become much quicker and easier over recent years.

Banks and building societies offering the best accounts are so eager for your business, they have even set up dedicated switching teams to make sure any new customers can open accounts without any hassle.

If that sounds tempting, accounts worth a look include the Santander range - which includes accounts aimed at those looking for high credit interest and those more interested in a competitive overdraft rate - and the Halifax Reward account, which pays customers £5 for each month they pay in at least £1,000.

2. Pay off your credit card in full every month

Banks make huge amounts of money out of customers who take out cards, spend, and then pay off only the minimum every month - and that means that you definitely don't want to fall into this category.

Paying only the minimum monthly payment every month can make any credit card debts you build up last for decades, while you end up paying huge amounts of interest.

But if you manage your account well enough to pay off what you spend within the interest-free period each month, you can benefit from credit cards offering cashback or reward schemes, without it costing you a penny.

3. Overpay on your mortgage
While the interest rate you pay on your mortgage is generally lower than that you pay on other debts such as credit cards and personal loans, you hold this debt for longer - meaning that the banks can still take huge amounts from you over the term.

If you have some spare cash, and your mortgage deal offers you the ability to overpay, you can massively reduce the amount you pay overall by overpaying on the loan.

Check the terms and conditions of your mortgage before doing this, however, as there's often a limit on how much you can overpay without incurring penalties.

4. Change your savings account
Banks and building societies have no compunction about leaving your savings languishing in accounts paying well below the interest rates available elsewhere.

So you should have no concerns about moving your cash to a different provider offering a better deal.

Top accounts available at the moment include the Nationwide MySave Online Plus account, which offers easy access to your savings and has a current headline rate of 3.05%.

5. Give Zopa a try
If you are in the market for a personal loan, but are sick of giving the banks your hard-earned cash, you can sidestep the system by borrowing - or lending for that matter - through Zopa.

It brings together individuals who want to lend money to other consumers in return for interest of about 8%, depending on the amount being loaned or borrowed and the borrower's circumstances. To find out more, visit the Zopa website.