Banks aiming to be 'one-stop shop' for customers

Many banks have already limited unsecured lending, such as loans and credit cards, to their current account customers, and there is a growing trend for them to target these consumers for mortgage lending as well.

A number of the big high street banks and Nationwide Building Society are offering special mortgage deals exclusively to their current account customers, according to financial information group Defaqto.

These deals range from free valuations and cash-back options, to preferential rates and the chance to borrow a higher proportion of a property's value.

Abbey, soon to be rebranded Santander, also has a current account that is only available to its mortgage customers.

Current account customers are also routinely offered preferential rates on savings accounts, as banks focus on cross-selling products.

David Black, banking specialist at Defaqto, said: "Banks see the current account as the main relationship builder with the customer and it also enables them to have a much better understanding of the financial capabilities of each customer.

"The cross-selling of other products on to the existing customer base is destined to become the key battleground as each bank strives to become the one-stop shop for all the personal finance needs of their customers."

The trend ties in with banks' more conservative approach to lending in the wake of the credit crunch, as they have a broader picture of the financial circumstances of their current account customers, enabling them to better assess the risk of them defaulting on debt.

Defaqto said the trend could also help them to counter the ease with which consumers can now scan the market for the best products through comparison websites.

It said that while people may be tempted to move a single product to get a better deal, they were unlikely to want to change their entire range of accounts at the same time.