Tesco Bank has today re-opened applications for its current account paying a generous 3 per cent interest on balances up to £3,000 – but savers who apply will now need to work a bit harder to get this inflation-beating rate.
The supermarket bank unveiled the inflation-beating interest rate to win back custom following a high-profile cyber security breach, only to be swamped with demand. It suspended applications in February.
They have been reopened today, but the terms and conditions have changed.
The 3 per cent rate of interest is still guaranteed until April 2019, but to get it, new account holders will now have to pay in a minimum of £750 per month, and set up a minimum of three monthly direct debits.
UK adults can open up to two accounts each – but direct debits set up to your second Tesco account will not be counted.
Previously, there were no restrictions meaning savvy savers could receive 3 per cent interest on £6,000 spread across two accounts (meaning gross interest of £172 per year). However, customers who opened a Tesco current account before applications were paused will not have to comply with the new rules, a spokesperson confirmed.
The rate is one of the best on the market, following Santander’s decision to halve the top rate on its popular 123 account from 3 per cent to 1.5 per cent. Nationwide offers new customers 5 per cent on balances of up to £2,500 on its FlexDirect account for the first year.
Tesco Bank customers also receive an extra Clubcard loyalty point on every pound they spend at Tesco on their debit card, and one for every £8 they spend elsewhere. As they say – every little helps.