First Direct brings back £175 switching offer – is it worth going for?

First Direct has revived its £175 cash incentive for switching to its 1st Account, due to 'popular demand'. 

The bank said the deal had 'significant take up' when it was available for four weeks back in late March before being pulled last month. 

Here, Which? reveals how to get the £175 bonus, if the First Direct account is any good, and how the switching offer compares.

What does the First Direct account offer?

First Direct only offers one current account, but it packs a punch.

The 1st Account comes with no monthly fee and offers a £250 interest-free overdraft buffer. However, if you borrow more than £250, you'll pay 39.9% EAR.

It also offers fee-free spending abroad. Before the bank scrapped its fees in 2023, customers used to pay 2.75% to withdraw cash or spend money abroad.

You can also get access to a 7% AER regular saver account. You’ll need to put away between £25 and £300 each month for a fixed 12-month term.

• Find out more: best bank accounts for overdrafts

What's in the small print?

You’ll need to use the Current Account Switch Service to be eligible for the offer, and switch at least two direct debits or standing orders.

Other requirements include depositing a minimum of £1,000 into the account within 30 days of opening, and registering and logging into digital banking. 

First Direct said customers can expect to be paid the £175 within a month of meeting all the requirements.

This deal is only available to new customers, who haven’t previously held a First Direct product. You also won’t be eligible for this deal if you’ve held a First Direct or HSBC current account on or after 1 January 2018.

First Direct hasn't given an end date to the deal, however it can be withdrawn at any time so if you're keen it's worth taking action sooner rather than later.

• Find out more: how to switch your bank account

Is First Direct a good provider?

First Direct is a Which? Recommended Providers for 2024. 

It achieved a customer satisfaction score of 82% in our most recent survey of banks, placing it 2nd out of 21 providers overall.

In fact, First Direct has remained at or near the top of our tables for as long as we've been surveying the public.

It scored a maximum five stars for its customer service and how it deals with complaints, and four stars for its telephone banking, online banking, mobile banking and calls to customer services. 

First Direct also performed best of 11 banks in a Which? investigation into fraud helpline waiting times.

It’s worth noting that First Direct is a division of HSBC. If you have accounts with both, you should limit deposits to below £85,000 across both brands so your money is fully covered by the Financial Services Compensation Scheme.

• Find out more: best banks 2024

Make your money go further

Find the best deals, avoid scams, and grow your savings with our expert guidance. From only £4.99 a month, cancel anytime.

Join Which? Money

How does the switching offer compare?

There's only one other switching deal available right now, and it's quite a unique offering. 

Instead of a cash incentive, Virgin Money will pay 10% interest on balances up to £1,000 for a year if you switch to one of its three current accounts – M, M Plus and Club M.

If you meet the offer conditions, you’ll start earning the bonus fixed-interest rate of 10% gross/10.47% AER (fixed) on balances up to £1,000 from 1 July 2024 to 30 June 2025. Virgin Money will work out how much interest you earn at the end of each day based on the money in your account. This interest will be added to your M, M Plus or Club M account on the last working day of each month.

• Find out more:  Virgin Money offers 10% interest switch incentive – is it worth going for?

This article was updated on 14th May. We've added that the deal is only available to new customers of First Direct, who have not previously held a First Direct product, or opened a HSBC current account on or after 1 January 2018.