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NatWest and RBS scrap Reward account cashback: will you earn less?
NatWest and Royal Bank of Scotland (RBS) Reward customers will soon no longer earn cashback for paying their household bills.
The Reward accounts currently pay 2% cashback on seven types of household bills. But from 1 February 2020, this will be replaced by a maximum monthly reward of £5 if you meet certain conditions.
You'll still earn 1% cashback for spending at partner retailers, but with a £2 monthly fee is the Reward account still worth it?
How are the Reward accounts changing?
The 2% cashback on household bills will be replaced by a flat reward of £4 for paying out two or more direct debits, plus £1 for logging into the mobile banking app each month.
To offset this change the eligibility criteria will relax. From February you'll have to pay £1,250 into the NatWest or RBS Reward current account each month to qualify for the perks, instead of the current £1,500.
- Find out more:best and worst banks
Will the changes mean I earn less?
The average user will earn around £23 less per year under the new arrangement.
Currently, the Reward account could earn a typical household £6.90 a month or £82.80 a year when they're paying £345 a month on seven household bills.
Under the new system, if you earn the full £5 a month every month you'll get £60.
However, neither of those figures takes the monthly fee into account. After factoring in the £2 a month fee for the standard Reward account, your annual earnings drop to £58.80 under the old system or £36 under the new one.
| Account | Annual cashback | Annual profits (cashback minus account fee) |
| RBS/NatWest Reward - before February 2020 | £82.80 | £58.80 |
| RBS/NatWest Reward - from 1 February 2020 | £60 | £36 |
However, you'll still be able to earn 1% cashback from spending at certain retailers, which could help justify the cost of the account and reduced cashback potential.
Partner retailers that will allow you to earn cashback include:
- ATG Tickets
- Barrhead Travel
- Boux Avenue
- Caffu00e8 Nero
- Europcar
- P&O Ferries
What are the alternatives?
The Santander 123 Lite Account costs £1 a month but pays 1-3% cashback on household bills, as long as you pay in £500, pay two direct debits and log into mobile or online banking once every three months. Alternatively, you could try the Santander 123 Account, which pays the same cashback on household bills plus 1.5% AER interest on balances up to £20,000, for a higher £3 monthly fee.
Barclays Blue Rewards pays £7 a month when you pay out two direct debits, pay in £800 and pay a £4 fee. You can qualify for additional cashback if you have other Barclays products, including £5 a month for a mortgage, up to £3 a month for home insurance, up to £5 a month for life insurance and £1 a month for a personal loan. If you apply by 30 November you can double your rewards.
If you're after minimal outlay, the Co-operative Bank has no monthly fee and will allow you to earn £4 a month when you pay out four direct debits, pay in £800, opt for paperless statements and log into mobile or online banking. You can also earn up to £1.50 a month from everyday debit card transactions.
- Find out more:best bank accounts for cashback
How to switch your current account
If you have the NatWest or RBS reward account it's worth checking how your cashback balance will be hit.
If you find your gains will drop significantly under the new system, it might be worth shopping around for a new more rewarding account.
You can usually switch your current account in seven working days using the Current Account Switch Service.
- Find out more:how to switch your bank account
