NatWest unveils a bumper £175 bank account switching offer – but with cashback rewards shrinking and a monthly fee, is it worth it?
- NatWest offering the three-figure sum on all its accounts until April
- This is provided switchers haven’t received a bonus since October 2017
- HSBC Advance also offers £175 and First Direct £100
- NatWest’s Reward accounts are less generous than they used to be
NatWest has made an attempt to win over customers potentially turned off by its cashback cuts with a new bumper £175 switch offer.
The three figure cash carrot, £25 higher than what the bank has typically offered in the past, is open to those who haven’t received a switch offer from NatWest since October 2017 on all of its accounts until 2 April 2020.
HSBC’s Advance account also currently offers £175 to switchers, and First Direct £100, meaning those after a new bank account are once again spoilt for choice when it comes to switching bonuses.
Cash carrot: NatWest’s new £175 welcome bonus ties HSBC’s offer and means potential switchers have several chunky switch bonuses to choose from
NatWest has described the reward as its ‘highest ever guaranteed switcher offer’, with those switching to its monthly fee Reward account ‘guaranteed to be at least £211 better off once the £2 monthly charge has been deducted’.
However, the extra £25 up front is likely to compensate for the fact that NatWest and stablemate Royal Bank of Scotland’s Reward accounts are not as generous as they once were.
Its Reward, Reward Silver, Platinum and Black accounts previously paid 2 per cent cashback on seven types of household bills, which the banks said paid customers an average of £83 a year.
But this month this was changed – customers earn £1 a month for logging into mobile banking and £4 a month for having two direct debits of at least £2 each.
This caps cashback at £5 a month, or £60 a year, which drops to £36 a year after the £2 fee.
Those who can get access to NatWest’s Premier Reward Black account will be able to get a higher £10 a month in cashback, but it comes with a £31 monthly fee.
The account also comes with worldwide travel insurance and airport lounge access, as well as breakdown cover and a concierge service.
NatWest’s previous switching offers helped the bank gain more than 31,000 current account switchers between January and June 2019, according to official switch figures, but between July and September it lost a net 9,855.
Nationwide and HSBC have had the most successful first nine months of 2019 according to the figures, gaining a net 90,000 and 59,000 current account switchers on the back of generous switching offers.
Overall, 739,923 accounts were switched between January and September.
Nationwide’s FlexDirect account has offered newcomers 5 per cent in-credit interest on balances of up to £2,500 and a fee-free overdraft, both for the first 12 months, while HSBC has preferred upfront cash offers.
Andrew Hagger, founder of personal finance site Moneycomms, previously told This is Money that he expected most future current account switchers to be swayed by one-off sweeteners.
He said customer have less reason to switch banks now cashback rewards and credit interest have increasingly been slashed ‘to almost worthless levels’.
Customers after the £175 offer from NatWest must switch using the current account switch service, pay in £1,500 to the account and log into online or mobile banking before 10 May 2020.
They will then receive the money by 5 June.
THIS IS MONEY’S FIVE OF THE BEST CURRENT ACCOUNTS
Santander’s 123 Lite Account will pay up to 3% cashback on household bills. There is a £1 monthly fee and you must log in to mobile or online banking regularly, deposit £500 per month and hold two direct debits to qualify.
NatWest’s Reward Silver Account offers a £175 switching incentive to new and existing customers as well as insurance cover for European travel. Customers can also earn rewards which can be redeemed as cash or gift cards.
Club Lloyds’s Current Account offers benefits such as cinema tickets, magazine subscriptions and dining cards to current account holders. There is no cost if you pay £1,500 each month, otherwise a £3 fee applies. Must hold two direct debits to earn monthly credit interest.
HSBC’s Advance Account offers £175 cash if you switch to it. The account comes with a £1,000 starting overdraft and 2.75% regular saver account. There is no monthly fee, however you must deposit £1,750 per month into the account.
Nationwide’s FlexDirect account comes with 5% interest on up to £2,500 – the highest interest rate on any current account – if you pay in at least £1,000 each month, plus a fee-free overdraft. Both perks last for a year.
