A simples guide

Santander 123 Current Account

The Santander 123 current account is a bank account designed to offer attractive extras like cashback on payments, and interest on balances. It does however, come with a monthly fee.

Let’s take a look at it in more detail to see whether it’s right for you.


The features

  • 1% cashback on water and council tax bills plus 1% on the first £1,000 you pay towards a Santander mortgage.
  • 2% cashback on gas and electricity bills.
  • 3% cashback on mobile and home phone bills, broadband and paid TV packages.
  • 1% interest on your balance once you have £1,000,2% interest on your balance once you have £2,000,3% interest on your balance once you have £3,000 up to a maximum of £20,000


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coins and credit cards

The costs and requirements

  • £5 account fee payable each month.
  • £500 minimum deposit each month.
  • Have at least two direct debits active on the account.

Does it make sense?

Assuming you can afford to pay in the £500 minimum each month, and have the direct debits required, you’ll need to do the maths based on your balance and personal outgoings to see whether the account makes sense for you.

What you know is that Santander will charge you an account fee of £60 per year (£5 a month). By looking at your bills that are included for cashback, you can calculate whether you earn enough cashback to save money before taking account of the interest you’ll receive on any bank balance.

Research at the end of December showed that the average customer was earning just over £75 a year cashback excluding mortgages.

If you were to be paying £1,000 or more into a Santander mortgage each month, you’d earn £120 per year on that element. That’s in addition to any cashback earned on your bills.

Then there’s the interest side of things. If you have over £5,000 in your current account, then the interest paid all the way up £20,000 is up there with the best on offer versus similar products. A £20,000 balance over a year for example, would earn almost £600 interest a year.

However, for lower bank balances there may be other more competitive accounts.

For example TSB pays 5% on balances up to £2,000, Nationwide Flex 5% up to £2,500 and the Club Lloyds account pays 2% on balances between £2,000 and £4,000 and 4% on balances between £4,000 and £5,000.

Ultimately, whether the Santander 123 current account makes sense for you depends on your outlook with regard to your bank balance and bill payments.

For a comprehensive look at what accounts are available, it couldn’t be simpler. Just use our current account comparison service. We’ll show you your options to help you find one that’s just right for you.

All Santander 123 account details are based on information provided on santander.co.uk data on 20 April 2016

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