MoneyMagpie

Sep 16

Make money by switching your bank account

Switching your bank account has never been easier. New regulations mean you can now move your current account, along with all your direct debits and standing orders, to another bank within just seven days. Because of this, banks are now offering cash incentives for switching your bank account over to their bank, meaning you could make money for very little effort!

Here are the latest current account best-buys that could make you money.

It’s strange, most of us don’t bother to switch our account. In fact, you’re more likely to get divorced than change your bank account – which is madness, as it’s easy to do and the rewards speak for themselves as you can see from our top picks here:

Current accounts that pay you interest and cashback

Santander 123 Current Account

This great account offers up to 3% cashback on your household bills:

  • 1% on water, council tax and Santander mortgage payments
  • 2% on gas and electricity billssantander123account
  • 3% on mobile, home phone, broadband and paid-for TV packages

Plus, there’s up to 3% interest to be had on your balance:

  • 1% AER on balances from £1,000
  • 2% AER on balances from £2,000
  • 3% AER on balances from £3,000 – £20,000

To qualify, you’ll need to:

  • Pay a monthly account fee of £2
  • Fund the account with £500 a month (a minimum balance of £1,000 is required to receive interest).
  • Set up at least two Direct Debits.

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 for your current account, despite the benefits.

the moneymagpie current accounts comparison tool

Nationwide FlexDirect Account

This new account offers a whopping 5% interest for in-credit balances up to £2,500 (fixed for 12 months). Plus, there’s a fee-free overdraft for a year and no monthly account charge to pay.nationwideflexdirect

So if you have the full £2,500 invested in this account, it would net you £125 interest over a year.

To qualify, you simply need to pay in £1,000 every month.

Good if: you usually have a balance of £5,000 or over.

Bad if: you’re always dipping into your overdraft – once the fee-free period expires, you’ll be charged 50p a day for using it.

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Current accounts that pay you for switching your bank account

The new seven-day switch legislation means that not only is it easier than ever to move your money to a better account, banks are falling over themselves to get your business. Here are some great accounts offering you a cash incentive if you switch to them.

First Direct 1st Account – £125 for switching

First Direct are offering a lovely £125 if you move your money to their 1st Account. Plus, you’ll get a £500 overdraft as standard, £250 of which is free of interest.

firstdirectThis is a great offer, but make sure you’re aware that you must pay in at least £1,000 a month otherwise you’ll be charged a £10 fee. For new customers the fee is waived for the first six months.

First Direct are so confident that you’ll love their service that they’ll pay you £100 if you decide to move your account elsewhere within 12 months!

Halifax Reward Current Account – £100 for switching

Halifax will pay you £100 when you switch to their Reward Current Account. The benefits don’t end there, though – you’ll get a £5 reward every month you pay in £750 and pay out two direct debits. You must have remained in credit the previous month, but it’s a nice incentive to do that!halifaxcurrent

There’s a £50 overdraft buffer, so you won’t pay any annoying unplanned fees if you’re a little bit over your limit.

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. That’s fine – but even the laziest of us should consider switching every now and then. Banks rely on you not bothering to look for alternative accounts, 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 change.

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WHAT DO YOU THINK?

6 thoughts on Make money by switching your bank account

  1. One thing that might need to be considered is where the nearesst branch of any bank you switch to is. This could be especially important if you plan to collect coins in jars and do a lot of depositing or even if you sell stuff online and accept cheques or postal orders as payment. Although some banks do except deposits via the Post Office.




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  2. Does anyone out there know which is the best offshore bank to
    Put your money in giving the best interest rate thanks.




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  3. Obviously none of these banks want pensioners or other low earners as customers, if they only offer these accounts to people with at least £1,000 a month available to pay in. Doesn’t that just prove that banks are out to make money, not offer a good service to customers?
    Let’s hear it for a bank that actively encourages pensioners. After all, they have a guaranteed income for life and a pay-as-you-go mindset, making them a better risk in the long term.




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    1. Very good point Maggie. As you say, there’s a business opportunity there. It’s time that maybe one of the supermarket chains considered special banking offers for pensioners.




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      1. Interesting. Sounds like you could go around 20 to 30 years without be able to change your current accounts as a pensioner! But if a full state pension is about 113 pounds per week which works out as 452 every 4 weeks or 489 pounds monthly could you not add savings interest to this (or transfer money from an external savings account)? Look again as I found an account that accepts 500 pound a month deposit. Also surprised that National Savings & Investments haven’t provided a current count – unless they do not want potential borrowing customers.




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  4. A huge thank you to you. I’ve been struggling with my basic Barclays account and I’ve been thinking of switching to a different account but did not know which one. Basically, you’ve done the job for me. Thanks.




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