Best banks for switching, cashback, interest and overdraft deals UK 2021

Discover which banks give you money and other rewards for opening an account in the UK

Perhaps you have had an account with the same bank since you were a kid and have now decided that it’s time to look for a different one. Perhaps your bank has exhausted your patience after one too many admin blunders. Perhaps you’ve simply heard that switching your current account can generate a decent sum in free cash and are tempted.

Whatever the reason why you are looking for a switching bonus, this guide has the insights you need to make an informed decision.

Compare switching rewards and deals

From time to time, some banks offer customers a reward or a bonus for switching. Below we have listed some of the best offers currently available.

Table: sorted by interest rate, promoted deals first
Name Product Ratings Account fees Funding requirement Interest (AER) Arranged overdraft Incentive Representative example Link
HSBC
Finder score
★★★★★
★★★★★
User survey
★★★★★
★★★★★
£0
No minimum funding requirement
0% AER
Interest-free buffer of £500, N/A
£125 for new accounts when a minimum of two Direct Debits or Standing Orders are switched using the Current Account Switching Service within 30 days of account opening.
View details
HSBC
Finder score
★★★★★
★★★★★
User survey
★★★★★
★★★★★
£0
Min. £10500 Every 6 months. Min. £1750 Per Month
0% AER
39.9% EAR variable
Get £125 when you switch to an HSBC Advance Bank Account. Plus earn 1.00% AER / gross interest with the linked HSBC Regular Saver.
To be eligible for HSBC Advance, customers will need to pay in a minimum of £1,750 per month or £10,500 over 6 months and must qualify for a minimum £1,000 arranged overdraft. £125 switching offer for new customers only who haven’t held an HSBC current account, or opened a first direct account since 1 January 2018. Other T&Cs apply. Representative example: If you use an arranged overdraft of £1,200, you’ll be charged interest at 38.9% (0% EAR variable on first £25, 39.9% thereafter).
Go to site
View details
first direct
Finder score
★★★★★
★★★★★
User survey
★★★★★
★★★★★
£0
No minimum funding requirement
0% AER
39.9% EAR variable
£125 when you switch.
Receive £125 when switching using CASS and pay in at least £1,000 within 3 months of account opening. New customers only who haven’t held a first direct account or opened a HSBC or M&S Bank current account since 1 Jan 2018. T&Cs apply. Representative example: If you use an arranged overdraft of £1,200, you’ll be charged interest at 30.5% (0% EAR variable p.a on first £250, 39.9% thereafter).
Go to site
View details
Virgin Money
Not yet rated
£0
No minimum funding requirement
2.02% AER
19.9% EAR variable
Apply online from the Virgin Red app or website and complete a full current account switch using the Current Account Switch Service to receive 15,000 points.
Representative example: If you use an arranged overdraft of £1,200 you'll be charged interest at 19.9% EAR variable.
View details
loading

Compare up to 4 providers

Best switching deals

If you are looking for some easy money, a switching deal could be the best way. You must however switch and close your old account to get the bonuses listed below. The following banks currently have switching offers.

  • First Direct – £100 switching bonus
  • HSBC – £15 switching bonus
  • TSB – £55 cashback for opening an account
  • Virgin Money – 15,000 virgin points to spend on Virgin related products and linked retailers

High interest current accounts

We have created a guide on high interest current accounts that gives a good overview but below we have highlighted some key offerings.

  • Virgin Money – 2.02% on balances up to £1,000
  • Nationwide – 2% on balances up to £1,500

Banks that offer fee-free overseas spending

Best deals and rewards for students

If you are a student and looking for the best student account with rewards or deals then we have a page dedicated to the best student bank accounts and the rewards on offer.

  • 123 Student Current Account from Santander – Free 16-25 Railcard for new customers.
  • Bank of Scotland’s student account – Everyday Offers – Earn up to 15% cashback from selected retailers when shopping with a Bank of Scotland credit or debit card. Customers must be over 18, register for internet banking and activate the offer to be eligible.
  • Barclays Student additions – Free 12-month subscription to Perlego the online library when opening a Student Additions account.

The 123 Student Current Account comes with a free 16-25 railcard

123 Student Current AccountFinder Rating: 5/5

★★★★★

Go to site Read review

£0.01

Minimum opening balance

£0

Account fees

1% AER

Interest (AER)

Santander’s student account remains an excellent value for students, especially those who need to catch trains a lot, such as those moving to the other side of the country. You get a four year railcard with Santander, which gets you ⅓ off rail fare, a lifesaver when you need to go home for Christmas on a budget and need to buy a train ticket. It also offers an interest free overdraft up to £1,500 for the first three years of your degree, which then increases if you stay on for longer. Plus, you can get cashback of up to 15% at some major retailers.
  • Interest-free overdraft;
  • Earn interest on in-credit balances;
  • Earn cashback with retailers.
  • Not available for international or postgraduate students;
  • There are plenty of student accounts with larger overdrafts.
Free 16-25 Railcard for new customers.
Account fee
Interest rate 1% AER
Minimum opening balance £0.01
Minimum operating balance £0.01
Switch service guarantee Yes

Best deals and rewards for business owners

If you run a business and wish to switch account, we have a dedicated guide on the best business bank accounts. Some business bank accounts are known to offer deals such as free company registrations, accounting software integrations, favourable foreign transaction fees and free introductory periods.

  • Tide – Register a limited company for free when you open an account.
  • Mettle – Free accounting software you can integrate your business bank account to.
  • Starling – Use Starling’s business toolkit free for the first month.

Free company registration when you open an account with Tide

Tide

★★★★★

Go to site Read review

24/7 customer support

Instant notifications

Software integration
Tide is a fintech app which offers business accounts to small businesses and freelancers, hoping to relieve them of some of the financial stress that comes with a growing company. Tide’s business accounts come with a number of features that address some of the most stressful aspects of working for yourself and offer all of this for free.
  • 24/7 customer support
  • Categorised spending
  • FCA regulated
  • Quick set-up
  • No monthly fees
  • Easy to manage accounts and track payments within the app
  • Ability to set up direct debits and standing orders
  • Can receive online bank statements
  • No branches - all done via the web
  • Doesn't accept cheque deposits
  • No personal accounts
  • No international
  • Transfers or interest offered
Account fee £0
UK ATM Charge £1
Account software integration platforms FreeAgent
KashFlow
QuickBooks
Reckon One
Sage
Xero
UK transfer charge £0.20
Additional cards 35 additional cards
Additional card fee Free
Credit check No - Tide performs an electronic check but no credit check

Best deals and rewards for children

Recently a number of banking apps have started popping up around children’s banking. These apps can help children spend, budget and learn about good financial habits early on in life.

  • gohenry – A personalised custom card with your child’s name on plus the first month free.

Get a personalised custom card and one month free with gohenry, a prepaid card for children

£2.99

Monthly fee

£0

Card delivery fee

£0

Cash withdrawal fee

gohenry is designed for children aged 6 to 18, and is managed digitally through an app for a monthly fee. It consists of a parent and child account combination, which sees parents use their account to top up the child’s balance and set limits on their spending. The child can check the available balance in their account and spend the money they’ve been given using a prepaid Visa debit card. Its free to use the card to make purchases online and in-store, as well as to make ATM withdrawals in the UK. But you only get one free money load from the parent’s account to the child’s account each month – after that it’s 50p per top-up.
  • Full parental control thanks to instant notifications and spending limits
  • Spend abroad fee-free
  • One-month free trial
  • It can be used by children as young as six
  • Reward system for completed tasks
  • Children learn about personal finance in a controlled environment
  • Relatives can also send money to the children
  • You can manage up to four child accounts from the same parent account
  • Monthly fee
  • Only one free top-up to the child account a month
  • Safe, but not as safe and regulated as a bank
  • You cannot load cash onto the account
  • It doesn’t pay any interest
Monthly fee £2.99
Card delivery fee £0
Card transaction fee £0
Cash withdrawal fee £0
Loading fee 1 free/month, then 50p each
Replacement card fee £4.99
Network VISA
How many child accounts 4
Fees abroad £0
Other fees £0
Freeze/unfreeze card Yes

Best banking app deals

Over the years a number of banking apps have come on to the market with innovative features. Some of these apps have deals when downloading the app and opening an account.

  • Curve – An app that helps you connect all your bank cards so a single card is offering £10 added to your card when you use the code FINDR.
  • Chip – A savings app that automatically connects to your current account and stashes money away automatically is offering access to its Chip+1 account which provides a 1.25% return on savings of up to £10,000 when you use the code FINDER20.

What’s a switching bonus?

A switching bonus is what you can get for transferring your current account to a new bank. So, it’s basically a bank “giving you money” for getting an account with it.

Switching bonuses are usually offered by big traditional banks, and they can be temporary offers lasting a few months.

They usually apply when you complete a full switch of your current account, and this will often include a minimum number of direct debits that you have to move. You won’t usually get a bonus for opening a new account (that’s why it’s called a “switching” bonus).

Should I switch current accounts?

The answer depends on your circumstances, so only you can determine that. But here are a few things to think about:

  • Are you with your current bank because it offers good service? Or are you with it because you’ve been too lazy to do the switch so far?
  • Switching current account is pretty easy. Thanks to the current account switch service (CASS), all your payments and direct debits will be transferred automatically within seven days. The two banks will handle the process and you’ll barely have to lift a finger.
  • A switching bonus is a temporary benefit. Whereas your current account is something you use pretty much every day, even if you don’t really think about it. If the bank you are considering has a really juicy switching bonus offer but an awful mobile banking app, it may not be worth putting yourself through that kind of misery for a few quid.
  • Banks are awful at rewarding customers for their loyalty. Banks know that people really don’t want to go through the hassle of getting a new account; once they’ve got someone as a customer, they don’t need to do much to keep them. So switching is more likely to land you a better deal.

So, weigh the pros and cons carefully. If you do decide to switch, ideally you want to pin down the best combination between a nice switching bonus and a reliable bank that offers a good long-term service.

Why do banks offer switching bonuses?

To put it (very) simply, banks want your money. It’s how they are able to provide services such as mortgages and loans, which in return generate their profits.

But, as we mentioned above, people hate moving bank accounts. With the notable exception of a few personal finance junkies like yours truly, most people just want to have a bank account that works and then not to think about it ever again.

So, for banks, getting new customers is quite hard. Switching bonuses are one of the marketing tools available to them to entice people to transfer their accounts and money with them.

What happens when you switch?

If you go through with a switch, all your incoming and outgoing payments are automatically transferred to your new account. This includes your salary, all your bills as long as they are paid by direct debit or standing order, and most importantly any future payments you might receive from someone who has your old banking details (the service will also contact them to let them know the new ones!).

You can pick your switching date in advance, and even transfer an overdraft as long as your new bank agrees to it. Once it’s all done, your old bank will close your old account, and you’ll be all set with your new one. If your new bank offers a switching bonus, you’ll receive it once the switch is complete.

Using CASS is free, easy and you are likely to end up with a better deal or a better banking experience. However, keep in mind that the service only works for current accounts, so savings accounts will not be transferred.

You will also need to update all your regular payments made via debit card manually, and these can be a lot (for example, your PayPal or Amazon accounts will have memorised your debit card details, not your current account details, so you’ll need to change them when you get your new debit card).

Pros and cons of switching

Pros

  • You can get a nice switching bonus (and use it to treat yourself!).
  • You can choose a bank that offers a better customer service or a better mobile app… whatever you don’t like about your current bank, you don’t have to put up with it!
  • All payments are automatically transferred to your new current account thanks to CASS.
  • It’s free and fairly quick; the switch has to be completed within seven days.

Cons

  • Other accounts you might have with the same bank, such as savings accounts, will not be transferred.
  • You will need to amend your debit card details.

Frequently asked questions

We show offers we can track - that's not every product on the market...yet. Unless we've said otherwise, products are in no particular order. The terms "best", "top", "cheap" (and variations of these) aren't ratings, though we always explain what's great about a product when we highlight it. This is subject to our terms of use. When you make major financial decisions, consider getting independent financial advice. Always consider your own circumstances when you compare products so you get what's right for you.

More guides on Finder

Ask an Expert

You are about to post a question on finder.com:

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • finder.com is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked
Finder.com provides guides and information on a range of products and services. Because our content is not financial advice, we suggest talking with a professional before you make any decision.

By submitting your comment or question, you agree to our Privacy and Cookies Policy and Terms of Use.

Questions and responses on finder.com are not provided, paid for or otherwise endorsed by any bank or brand. These banks and brands are not responsible for ensuring that comments are answered or accurate.
Go to site