Santander 123 fees hit £60

14 September 2015

santander_gMillions have signed-up for Santander's 123 account, but thanks to a change in fees, it is going to hit the pocket hard. From January, fees are going to almost triple.

There's around 3 million in the UK using the current account, and pay in £2 every month (or £24 a year if you prefer) and, in return, you get cash back on bills and a 3% interest rate. However, as of next year, customers will be paying £60 every year, which is £5 per month.

If you have a smaller balance, you will invariably not reap the benefits. So if you have the minimum £3,000 in the bank, you will earn £90 in interest, with £60 of that gone in fees. That's equivalent to a 1% interest rate.

So with that, it could well be time to switch accounts. There's a number of good deals around (we've previously extolled the virtues of the Santander 123 account, but after this change, it doesn't seem like the good value it once did). Some account providers will actually pay you to switch, which is half decent... however, do a little research first, as you don't want to be lured in with a good offer with a bank that has lousy customer service or will sting you on overdraft fees or what have you.

One favourite to switch to, is Halifax, who will hand new current account customers to £125. Until the 18th October, those using the Current Account Switching Service to join the Halifax will get their dough. If you pay in £750, you'll get a £5 monthly award too. You'll need to set up two direct debits and be in credit every month for this to work.

First Direct are also paying you if you switch, giving new customers £100 to join them. If you want to leave them after 6 months, they'll give you another £100 when you leave. Yorkshire/Clydesdale Bank are doling out £150 to switch, but you need to pay in at least £1,000 for at least two months, and have two or more direct debits.

The Co-op Bank, who have been in a lot of bother of late, are giving out £125 to those who switch, with £25 of that sum going to charity, if that's your thing. You have to pay in at least £800 within 31 days of switching, and again, have two direct debits. First Direct's 1st Account will get you £125 for switching, and a £250 interest-free overdraft bundled in as standard.

There's more deals doing the rounds, so have a look and see what suits you best. uSwitch have a guide and comparison table, here.

TOPICS:   Banking

1 comment

  • Albi
    It's all pointless though unless you never use your overdraft. Getting a £1500 buffer is a PITA when you switch.

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