Santander has launched a cashback incentive that could give Britons some extra cash to weather the cost of living storm this fall.
It offers £160 cashback to both new and existing customers when they transfer a current account to some of its bank accounts through its official switching service.
The £160 sweetener is the most generous currently on offer, closely followed by Halifax and First Direct, both of which are offering £150 cash offers to new members.
Home to 5.4 million UK customers, Santander has announced 160 cashback incentives that could help switchers overcome the cost of living
To be eligible for Santander’s £160 cashback you must switch to a Santander 123, 123 Lite, Everyday, Select or Private current account.
Customers must complete the switch within 60 days, deposit a minimum of £1,000, set up two active direct debits and log in to online or mobile banking.
The cashback will be deposited directly into their qualifying Santander current account within 30 days after that.
The bank also announced today that it will double the cashback on customers’ gas and electricity bills for two months from 2 percent to 4 percent starting in September.
To take into account that the average energy bill will exceed £3,000 per year from October, it has increased the monthly limit from £5 to £10 per month for the two-month period.
This is of interest to anyone who has a 123 account, a 123 Lite account, or a Select account.
Since the average annual utility bill is likely to be over £3,000 from the fall, someone with one of these accounts should earn £10 cashback per month on their utility bill during this period before dropping back to just £5 cashback per month from then on.
Customers will also receive this additional cashback automatically and the cashback on other household accounts will be paid at either 1 per cent or 3 per cent, each subject to a maximum of £5 per month.
Santander is the only bank that offers customers continuous cashback on household accounts. As of September, it has increased the category from 2 percent to 4 percent.
There are three categories meaning it is theoretically possible to earn up to £15 per month in cash back on accounts.
City taxes, cell and home phone bills, broadband and paid TV packages all earn 1 percent cash back, while water bills get 3 percent cash back.
Hetal Parmar, Head of Banking and Savings at Santander UK: ‘For over ten years now, our 123 current account customers have received a constant value every month.
“Today’s offerings package is an added incentive, putting more money into our customers’ pockets and highlighting our commitment to supporting them with their day-to-day bills.”
What about the cashback offer?
In terms of cashback, Santander seems to be the most generous offer on paper.
Because the utility bill is so high, it will likely mean someone will earn £70 cash back on their utility bill over the next year – £20 in September and October, and £5 per month thereafter.
Together with the £160, that adds up to £230 cashback in total.
For those who pay their council tax, mobile and phone bills, broadband and TV packages through either of these two checking accounts, they can also earn 1 percent cash back up to a maximum of £5 per month.
It’s worth noting that Santander mortgage customers also receive 1 percent cash back on their monthly payment if they have a 123 account.
The average Band D council tax set by local authorities in England for 2021-22 will be £1,898 according to government figures.
Even 1 percent cash back on the average council tax assessment can therefore be worth £19 after a year.
However, along with the other bills included in the category, this could mean some households are approaching the £5 ceiling each month, despite the cashback being worth just 1 percent.
The average annual cost of a water bill is £408, according to Water UK, meaning the £5 monthly cashback limit is unlikely to be reached.
Given the average bill, a typical Santander customer could expect around £12 cashback on their water bill.
However, it’s worth noting that Santander’s 123 and 123 Lite accounts cost £4 and £2 monthly respectively. The Select account also charges £4 per month.
Only his Everyday account is free, but while this includes the £160 cash back switching bonus, it does not offer cash back on accounts.
The monthly fee means you’re giving out £24 or £48 of your total cash back winnings on monthly bills.
Often these deals are also concluded for existing customers. However, if you have a secondary account elsewhere but already have a Santander account, you can take advantage of this by switching and following the terms and conditions – as long as you have not previously had a switching bonus from the bank.
The next most lucrative bank account exchange offer on the market is offered by Halifax, offering £150 to anyone who opens their checking account.
In addition, customers can also benefit from £5 per month deposited into the account, which is equivalent to £60 over the course of a year. However, they can replace this with two movie rentals or three magazine rentals, or a free movie ticket every month if they want.
Halifax is offering £150 to anyone who opens their current account. It also comes with rewards and cashback that just give it an edge in our opinion.
This means that someone who switches to Halifax can earn £210 over the course of a year.
To take advantage of the £5 monthly cashback, account holders must choose to spend £500 on their debit card each month or keep at least £5,000 in the account at all times.
They must also deposit £1,500 or more into your account each month and remain on credit – keeping your balance at £0 or above.
There is a monthly fee of £3 for maintaining the account, but as long as £1500 or more is deposited into the account each month, this fee will be waived.
Another cash back bank account worth mentioning is Chase Bank, which offers 1 percent cash back on all spending for the first 12 months, with a few exceptions.
If someone were to spend £20,000 on the card over the course of the first year, that could go up to £200 in cashback.
The account comes with no monthly or annual fees and is completely app-based.
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