Usually if it sounds too good to be true it is a con. But just now the banks are offering free money, and while it takes a little bit of work to get, it is worth the effort.
NatWest, First Direct, TSB and Lloyds are all offering cash lump sums to new customers and extra benefits as well.
NatWest is offering £200 to customers who switch to the NatWest Reward account or the RBS Reward account. In addition the customers get cash back of £5 a month, although you have to pay a £2 monthly fee and must pay at least £1,250 into the account and have two direct debits. You will also have access to a 6% regular saver account.
First Direct gives £175 and has a 7% regular saver and an interest-free £50 overdraft.
TSB will pay £125 to new customers in April and then a further £75 in November. And you may get £5 a month cash back if you use the debit card more than 20 times a month. Its regular saver pays 5%.
Lloyds wants new customers for its “Silver” packaged account, which costs £10 a month. The bank will give customers £200 free cash and expects it to be used to cover the monthly fee for 20 months. The account offers family travel insurance in Europe and roadside breakdown cover.
The banks are making big profits from the difference between the interest rates they charge borrowers and what they pay savers. So it is time to have some of the money they make.
It is also a good idea to have a second current account so that if your bank’s computer system goes down you have an alternative. But beware the banks want new customers that they can sell their services to. You need to make sure that the free money does not cost you dear.