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Current account battle heats up as another bank offers cash-to-switch deal

Paloma Kubiak
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Paloma Kubiak

RBS is the latest bank to offer a cash switching incentive for new and some existing customers joining the provider. How does it stack up?

For the first time in nearly a decade, the Royal Bank of Scotland (RBS) has launched a £100 switching offer, available online only until 6 July 2018.

In order to be eligible, you need to use the Current Account Switch Service (CASS), close your existing account and pay in at least £1,500. You’ll also need to log in to your online account or via the banking app by 24 August.

The £100 will then be paid by 5 October. If you’ve previously been an RBS customer, you can take advantage of this incentive as long as you’ve not received a cash offer from the bank in the past.

You’ll be able to open the everyday bank account, called ‘select’, or you can choose to open a reward account. The reward account offers 2% cashback on household bills, with an average of £83 received over the year.

These customers will also benefit from fee-free foreign transactions on debit card purchases until 31 August.

How good is this offer?

A number of banks have come up with tempting switch incentives to lure customers in.

The most recent was from HSBC, offering £200 until 30 June (£150 within 30 days and £50 a year after the account has been registered).

It comes with a number of stipulations though, including setting up at least two direct debits/standing orders, you must pay in at least £1,750 a month or £10,500 over six months, excluding internal transfers and you need to register online and/or mobile banking within 60 days of the account being opened to qualify for the additional £50.

After axing the up to £125 switch incentive, First Direct introduced tech and travel vouchers worth hundreds of pounds. It also has a lower monthly account threshold of £1,000 (or maintaining a £1,000 monthly balance), good for those who aren’t able to reach the minimum £1,750 for the HSBC incentive.

Barclays was the next banking behemoth to re-jig its offer, with new and existing customers receiving double the incentives – the former for a year and the latter for the month of May. As a minimum, new switchers are able to gain £132 a year, after the £3 a month fee (£36 annually).

While this is lower than the HSBC and RBS offering, the more products you take out with Barclays, such as a mortgage, insurance, loan etc, the more you’ll be rewarded. This can take the rewards up to a maximum of £348 a year, again after the £36 a year account fee has been taken into consideration. The offer’s available until 29 June.

NatWest (part of RBS group) also waded into the current account switching war, offering £100 to new successful applicants, paid within 12 weeks of the move. The offer’s available until 15 June and savers can chose one of a number of different current account options, from fee-free to those with monthly fees and incentives such as fee-free foreign transactions until 31 August 2018.

However, it has scaled back the offer after previously touting a £125 switch incentive. This one’s the middle of the road as customers need to pay in £1,500 into the account before 13 July 2018.

Retailer M&S is also offering £185 in gift cards (£125 for the switch and £60 for staying with it for a year). You need to set up at least two active direct debits and a minimum of £1,000 needs to be paid into the current account each month.

Otherwise, Halifax offers switchers £75 within seven working days for moving to it. If you pay in £750 or more each month and set up two different direct debits, and stay in credit, you’ll receive a £3 per month reward. All in all, this means Halifax customers stand to gain £111.