NatWest is cutting the cashback rate on its Reward current account from 3% to 2% next week, and introducing a weighty £1,500 monthly pay-in for new customers.
From Monday (26 June), the bank will only pay 2% on seven household bills:
- gas and electric bills,
- home phone and broadband,
- mobile phone and data,
- TV packages,
- council tax
The bank says that the drop in cashback will be offset by a lower monthly account fee, which falls from £3 a month to £2 a month (£24 a year).
Is NatWest Reward still a good deal?
We’ve calculated that people with average household bills could lose £29 in cashback over a year, or around £40 if they have more expensive bills.
The new funding requirements require new customers to pay in at least £1,500 into their accounts every month and log into online or mobile banking at least once a month. If your salary was the only income you had going into your bank account, you’d need to be earning around £22,500 a year to meet this new criteria.
The same changes apply to the RBS Reward account, available in Scotland.
Where else can I earn cashback?
Instead of a flat rate of cashback, Santander 123 Lite pays tiered rates on the same household bills, plus Santander mortgage payments and home insurance, for a monthly fee of £1. The full version of this account offers 1.5% interest on in-credit balances up to £20,000, for a higher fee of £5 per month.
As with NatWest, you must pay these bills by direct debit (not by debit card or standing order). Also, you don’t earn any cashback on your TV licence, or on-demand internet streaming services such as Netflix and Spotify.
|NatWest Reward||Santander 123 Lite|
|Mortgage||–||1% (up to £1,000)|
|Home insurance||–||2% (Santander policy)|
Other banks pay ‘loyalty’ rewards, or regular cash bonuses for staying in credit.
Barclays Blue Rewards
This account has a monthly fee of £3, but the bank pays £7 as a perk for maintaining two direct debits, £5 if you have a Barclays mortgage, and £3 if you take out buildings and contents home insurance.
Halifax’s account pays £3 in cashback each month, as long as you pay in £750, stay in credit and pay out two direct debits. The bank has also brought back its £125 switching incentive (was £75), available until the end of July 2017. There is no account fee.
TSB Classic Plus
Customers can earn up to £10 a month if they spend on their debit cards 20 times in a month and pay out two direct debits (offer ends 30th June 2018). There is no monthly account fee with Classic Plus.
M&S Bank Current Account
This account also offers temporary cashback worth £5 a month (added to a gift card) to new M&S customers who pay in a minimum of £1,000 and set up two active direct debits. No account fee.
Reward current accounts compared
Assuming average bills where relevant, we’ve calculated the cashback benefits (after fees) of all of these accounts to help you compare rewards easily.
All of the current accounts mentioned above require customers to meet certain terms in order to qualify for rewards. Read our guide to cashback current accounts for all the details.