Make money by switching your bank account
Switching bank account to another provider is something everyone should consider. The benefits can be enormous and it’s actually simple to do. As with any service provider, it pays to always be on the lookout for a better deal. Switching bank accounts is no different.
Many of us are happy with our bank account and have no desire to switch, but that’s often because we’ve have never considered it and aren’t aware of the benefits it could bring. Financial regulation in the UK allows consumers to switch whenever they like and banks know this. As a result, they offer various perks to encourage customers to switch.
Some people switch periodically to make sure they are always taking advantage of the latest offers. Once you switch you’re be able to move your current account, along with all your direct debits and standing orders, to another bank within just seven days. It’s also completely free and the banks do all the hard work for you.
Did you know people in the UK are more likely to get divorced than switch their bank accounts during the course of their lives? This is an incredible statistic – and it’s due to us getting comfortable with our familiar bank.
Here are the latest current account switches you can make to save money and earn great rewards:
Most bank accounts offer rewards if you pay in a certain amount each month. For many people, their salary will easily cover this minimum requirement. However, if your salary isn’t high enough, you’re not earning anything, or you’re retired – don’t panic!
You’ll need two accounts to make this work, but that’s simple enough to set up. Your second current account should be with a different bank.
Put the monthly minimum amount – say £1,000 – into the second bank account.
Set up a standing order so that this amount transfers into your main current account.
Set up a second standing order for the following day on your main current account to shift the money back again.
This ‘cheats’ the minimum income requirement, as you’re simply shifting the same £1,000 in and out of the account every month!
Let’s examine what Santander is offering first, while more information can be found on their website; here are the basics:
- Linked 7.00% AER easy-access savings account (max £4,000 per month).
- 1% cashback on some household bills, capped at £20 each month.
- Pay in at least £500 into your account each month and have at least 2 active Direct Debits
- Earn cashback on your household bills for a £3 monthly fee to maintain the account
- Arranged Overdraft facility (if you’re eligible)
To qualify, you’ll need to:
- Pay at least £500 into your account a month
- 2 active Direct Debits – Think phone, mortgage, rent, utilities
- Be over 18 and live in the UK permanently
Good if: you know there will always be at least £500 going in every month and you’re happy to use this as your main account.
Bad if: you’re not prepared to pay a small fee of £3 every month to enjoy the benefits.
Chase current account
Chase Bank is a relatively new offering in the UK. Its current account could suit you if:
- You prefer card payments over cash payments – You can earn 1% cashback on almost all your debit spending for 1 year. (Max £15 cashback per moth).
- You’re comfortable using a mobile app as this account is app-only.
Good if: you travel overseas, as Chase’s debit card doesn’t charge you for overseas spending or cash withdrawals (max £1,500 overseas withdrawals a month)
Bad if: you want an 0% overdraft – Chase doesn’t offer one.
Nationwide FlexDirect Account
FlexDirect could suit you if:
- Your balance is often in credit – If you pay in at least £1,000 each month you’ll get 5% AER (4.89% gross p.a. fixed) interest on balances up to £1,500 for the first 12 months.
- You’d like an arranged overdraft – pay no interest on your arranged overdraft for 12 months from the date you open the account.
- You’re happy to do most of your banking online and using their app.
Good if: you usually have a balance of £1,500 or over.
Bad if: you’re always dipping into your overdraft.
There are other perks to switching your bank account. Some banks actually offer a cash incentive if you do. Here are the ones doing it in 2023:
Nationwide – free £200 for switching
Nationwide offers the most generous switching incentive right now. Switch to its ‘FlexDirect’ account and you can earn a cool £200 as long as you’re moving from another bank, and you move over at least 2 direct debits as part of the switch.
To be eligible, you can’t have had a Nationwide switch bonus since 18 August 2021.
First Direct – free £175 for switching
First Direct are offering £175 if you switch to their standard account as long as you haven’t had an account with First Direct before (or had an account with HSBC since January 2020).
To get the offer you must pay in at least £1,000 within three months.
Lloyds Bank – free £175 for switching
Another bank offering something similar is First Direct who are giving away £175 to anyone who switches by 14 November 2023 (as long as you haven’t received a switch bonus from Lloyds or its sister bank, Halifax, since April 2020.
Do note there’s a £3 monthly fee unless you pay in at least £2,000 every month.
TSB – free £150 for switching
TSB offers switchers to its ‘Spend & Save’ account a cool £175. To get it you must switch & move over at least 2 direct debits, spend on your debit card at least once, & use mobile banking – all by 31 October 2021.
On top of this, you can earn £10 cashback for 6 months if you spend 20+ times on its debit card every month. To be eligible for these offers you can’t have had a TSB switch bonus since October 2022.
Ready to change yet?
Many of us can’t be bothered to change our account every six to twelve months to ensure we’re getting the best deal on the market. Some of us have just never thought of it. That’s okay, but it’s worth investigating.
Banks rely on you not looking for alternative accounts, they offer perks to new customers while you just get the same service you always did, good or bad. But now it’s never been easier to switch so it’s a great time to take advantage of the incentives available.
You’re under no obligation to stick with your current bank, and the rewards are out there for those who are open to change.