TSB launches £10 monthly cashback for new current account users

1 March 2017
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Savers who take out TSB’s Classic Plus current account from today can earn £10 cashback each month until 30 June 2018 – on top of its 3% interest on up to £1,500. 

To earn the first £5 worth of monthly cashback you need to make at least 20 debit card payments a month – this includes payments made online, as well as those made using contactless or via a linked Apple Pay or Android Pay account.

For the additional £5 a month, you need to set up two monthly direct debits going to two different companies. 

You also need to register for internet banking.

 

The cashback offer ends on 30 June 2018 regardless of when you sign up for the account, and sadly it isn’t available to existing customers or those who’ve had a Classic Plus account in the past.

TSB’s existing 5% cashback on the first £100 worth of contactless debit card spending also won’t be offered to new customers. However, this perk is due to end on 30 September for existing customers who haven’t already had the reward cut.

The 3% cashback on up to £1,500 is an on-going offer – although it’s already been scaled back from 5% interest on balances up to £2,000 earlier this year. To earn this 3% you need to pay in at least £500 a month and register for online banking and paperless correspondence.

The account’s £25 0% overdraft will still be available. 

Moneywise verdict

TSB’s account would net you £165 AER (£164.40 gross) a year if you maintain the £1,500 balance and meet its £10 monthly cashback requirements – assuming you’re still within your £1,000 personal savings allowance (£500 for higher rate tax payers).

This beats what cash savers would earn in all other interest paying current accounts, bar Santander, where you can earn more but only if you have a much higher balance.

For example:

  • Bank of Scotland’s Vantage account would net you £90 to £150 AER (£88.80 to £148 gross) a year if you maintain its £3,000 to £5,000 requirement to earn 3%.
  • Nationwide’s FlexDirect account would net you £125 a year AER (£122.25 gross) if you maintain a its £2,500 balance to earn 5%. 
  • Santander’s 123 account would earn you £240 a year AER (£238 gross) once you subtract its £5/month fee, if you maintain its £20,000 balance to earn 1.5%.
  • Tesco Bank’s current account would net you £90 AER (£88.80 gross) a year if you maintain its £3,000 balance to earn 3%.

 

However, if you’ve got a small sum of money, which you want to grow with minimum fuss, Tesco Bank could be a better option as it’s the only one of the providers listed above to have no minimum pay-in or direct debit requirements. Applications are however, currently “paused” due to high demand.

Another easier option is to look for current accounts offering switching bonuses of up to £150. See our current accounts guide for the best buys.

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