RBS and NatWest take on Santander

Debit cards

RBS and NatWest have launched a new cashback scheme that offers customers cashback when they shop using their debit card.

In a direct challenge to Santander's 123 account, the new Cashback Plus scheme - which both new and existing current account customers can apply for – offers shoppers the chance to get 1p paid back in cash for every £1 they spend.

The scheme launched with an initial list of 11 retailers, including Café Nero, H. Samuel, BP and Cineworld; while Tesco is also taking part in the scheme for three months until 30 November.

The banks state that once customers have earnt £5 in cashback, it can be paid into their current account or exchanged for gift vouchers. Alternatively, more philanthropic customers can choose to have it paid direct to a charity.

However, in order to be eligible for the cashback, customers must agree to receive "targeted offers from participating retailers which are relevant to them".

Cashback Plus is a challenge to Santander's 123 current account, which pays: 1% cashback on council tax bills, water bills and Santander's own mortgage payments; 2% cashback on gas and electricity bills; and 3% cashback on home phone, broadband, and TV packages as well as mobile phone bills.

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However, while the new RBS and NatWest scheme is open to non-fee-paying customers, Santander's 123 account costs £2 a month and customers must pay at least £500 a month into their account.

More details can be found at: cashbackplus.natwest.com/ or cashbackplus.rbs.co.uk.