The rate rise is for customers who open or have a Santander current account and who then take out its regular eSaver product. The 3% rate is fixed for 12 months and it doesn’t apply to existing regular eSaver customers.

If you’re a 1|2|3 World or Santander Select customer with the correlating regular eSaver product, there’s no change to your rate – you’ll continue to receive the preferential rate of 5%.

For non 1|2|3 Santander regular eSaver customers, you can save up to £200 a month, so a maximum of £2,400 over the year. This means at the end of 12 months, having saved the maximum £2,400 you will earn £38.60 in interest.

Deposits must be made via standing order from a Santander current account but there are no limits to the number of standing orders per month (providing the £200 limit is not exceeded). There’s no need to make a deposit every month. Withdrawals can also be made at any time using online or mobile banking.

Hetal Parmar, head of banking & savings at Santander, said: “Our regular eSaver product offers one of the most competitive savings rates on the market and we are delighted to be offering customers an even better return.  We want to encourage people to develop a savings habit – even a few pounds a month can be the start of a nest egg or a bit of a cushion against emergencies.”