Focus On: £125 if you switch to First Direct

It’s not often in life that you’re offered money for nothing. But switch your current account to internet and telephone bank First Direct, and that’s exactly what you’ll get.

MoneySuperMarket has joined forces with First Direct to offer anyone switching to its 1st account an exclusive "golden hello" worth £125 – that’s £25 more than you get normally.

But, the offer is around for a limited time only so, if switching is on your radar, don't waste any time in taking action.

What’s the deal?

The First Direct 1st account already offers a £100 cashback switching incentive to new customers. But its partnership with MoneySuperMarket boosts that offer by £25.

The bank is renowned for its excellent customer service and, if you are not impressed with the treatment you receive, it will pay out another £100 if you leave again within the first 12 months.

There is no in-credit interest paid on the 1st account but it comes with a £250 interest-free overdraft buffer and a relatively low overdraft rate of 15.9% beyond that.

You’ll need to pay in at least £1,000 a month or have another product – such as a mortgage or savings account – with the bank. Otherwise the 1st account will cost you £10 a month to fund.

Who is it good for?

The exclusive £125 cashback switching incentive is a bonus whatever your situation.

But the account is most suitable for anyone who does not keep a large balance in their current account, as it won’t pay interest.

Its free overdraft buffer zone, on the other hand, means it’s better for those who occasionally slip into the red.

If you like to do your banking on the go, there’s a mobile app with the account which could also be a good fit.

And if it’s poor service you are trying to escape from at your existing bank, First Direct has glowing reviews on this front.

Any catches?

The biggest catch with the 1st account is that it pays no in-credit interest. And with some rival banks paying up to 5.00%, the benefit of the initial £125 incentive could soon be wiped out.

Also the fact that First Direct is primarily an internet and telephone bank will not appeal to everyone.

What’s the verdict?

The special offer MoneySuperMarket has brokered with First Direct makes its cashback switching incentive the most generous on the market.

But you’ll still need to do your sums as anyone who stays in the black could be better off elsewhere – particularly if your balance tends to be on the large side.

There may be no "golden hello" with Santander for example, but its 123 current account pays 3.00% on balances up to £20,000 (and above £3,000).

It also offers an interest-free overdraft for the first four months and cashback on your bills – although you must pay in £500 a month and pay a £2-a-month fee to benefit.

For smaller balances, look also at Nationwide’s FlexDirect and TSB’s Classic Plus accounts, both of which pay 5.00% on the first £2,500 and £2,000 respectively.

Nationwide’s 5.00% rate though only applies for the first 12 months and the account requires monthly funding of £1,000 compared with TSB’s £500. Both accounts are fee-free.

Please note: any rates or deals mentioned in this article were available at the time of writing. Click on a highlighted product and apply direct.

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