Co-op offering £125 'golden hello' to new customers
The Co-Operative Bank has launched a new incentive scheme for those signing up to its current account switching service – a £125 "golden hello" for new customers.
It comes on the same day that rival Nationwide has begun offering existing customers £50 if they refer a friend who goes on to take out a current account with the building society – with a maximum of ten referrals worth £500 a year allowed.
People who use the Current Account Switch Service to apply for a Co-op Standard Current Account or Current Account Plus and then credit it with at least £800 within 31 days will be eligible for the incentive.
The payment comprises £100 credited to the new account, along with £25 which the Co-op will hand to a charity of your choice. The list of eligible charities are: Action Aid, Amnesty International, Carers Trust, Help the Hospices, Oxfam, Water Aid, and the Woodland Trust.
The offer is not available to existing customers who have a Co-operative Bank or smile current account.
Since the Payments Council's Current Account Switch Service was launched in mid-September 2013, high street current providers have been falling over themselves to offer incentives to attract new customers.
At Nationwide, when an existing FlexAccount, FlexDirect or FlexPlus customer recommends one of the firm's current accounts (and that person completes a switch using the Current Account Switch Service), both parties will receive £50.
Existing Nationwide current account customers can recommend up to ten friends a year, giving them the opportunity to earn up to £500 a year.
Phil Smith, Nationwide's head of current accounts, said: "Word of mouth is valuable to us as it shows that our customers are pleased with the products and service we offer and that they are willing to recommend us to their friends and family.
"There are a number of switching offers on the market, but ours is the only one that rewards existing customers as well as new customers."
Invidivual Savings Accounts were introduced on 6 April 1999 to replace personal equity plans (PEPs) and tax-exempt special savings accounts (TESSAs) with one plan that covered both stockmarket and savings products, the returns from which are tax-exempt. The ISA is not in itself an investment product. Rather, it’s a tax-free “wrapper” in which you place investments and savings up to a specified annual allowance where the returns (capital growth, dividends, interest) are tax-exempt (you don’t have to declare ISAs and their contents on your tax return). However, any dividends are taxed within the investment, and that can’t be reclaimed.
An account opened with a clearing bank (few building societies offer current accounts) that provides the ability to draw cash (usually via a debit card) or cheques from the account. Some pay fairly minimal rates of interest if the account is in credit. Most current accounts insist your monthly income (salary or pension) is paid directly in each month and they offer a number of optional services – such as overdrafts and charge cards – which are negotiable but will incur fees.
This is a mutual organisation owned by its members and not by shareholders. These societies offer a range of financial services but have historically concentrated on taking deposits from savers and lending the money to borrowers as mortgages, hence the name. In the mid-1990s many societies “demutualised” and became banks. One academic study (Heffernan, 2003) found demutualised societies’ pricing on deposits and mortgages was more favourable to shareholders than to customers, with the remaining mutual building societies offering consistently better rates. In 1900, there were 2,286 building societies in the UK; in 2011, there are just 51.