The reduction, which takes effect from 2 May, means customers can earn a maximum of £22.38 a year on a balance of £1,500.

In order to benefit from the 1.5% interest rate, customers will need to pay in at least £500 a month into the current account, register for internet banking and opt for paperless statements and correspondence.

TSB said it is in the process of writing to customers to inform them of the changes.

The interest rate on the Classic Plus account has been scaled back from its previous 5% deal – offered as a gesture of goodwill after the bank’s major IT meltdown in 2018.

TSB’s director of everyday banking products, Craig Bundell, said: “We’ve reviewed our rates, as we do regularly with all our products, to make sure they’re sustainable and give our customers a competitive interest rate as part of our current account offer.

“This new rate remains one of the best in the market. And, just like before, our Classic Plus account offers lots of benefits to customers. We are the only bank to offer our Fraud Refund Guarantee, where TSB protects customers that are victims of fraud by refunding every penny lost.”