M&S Bank customer? You can now bag £100+ switch bonuses from HSBC & First Direct no matter how long you’ve held your account

Until now, M&S Bank had said that customers who switched to HSBC or First Direct wouldn’t be eligible for the bonuses – a free £125 or £100 respectively – if they’d opened their account since 1 January 2018. But it’s now U-turned on the decision, and will also retrospectively pay out the cash bonuses to any M&S Bank customers who’ve switched to HSBC or First Direct since 4 March 2021 but missed out.

The move will be a huge boost to M&S Bank current account holders, all of whom must switch or close their account as it’s shutting all accounts in August. HSBC and First Direct are our best buys for those looking for a current account switching incentive currently – though you’ll still need to meet the banks’ other switching criteria to benefit.

The top current accounts pay up to £125 to switch

The top current account switching offers are as follows:

• HSBC offers a switching bonus of £125 (plus access to a 1% regular saver). To get it, you must move two+ direct debits or standing orders across and pay in £1,750+/mth. See full HSBC info.

• First Direct offers a switching bonus of £100 and GREAT customer service (plus access to a 1% regular saver). To get the bonus you must pay in £1,000+ within three months. See full First Direct info. 

• Virgin Money gives you 12 free bottles from Virgin Wines (valued at £138), plus £50 for charity. To get it you must move across two direct debits, download and register for its mobile banking app, and add £1,000 to its linked savings account (and keep the cash there until you get your Virgin Wines code). See full Virgin Money info. 

For full info on all the above, plus more current account options, see our Best Bank Accounts guide.

M&S Bank is closing all of its current accounts in August

M&S will close all of its current accounts and all 29 of its in-store bank branches in August due to customers switching to banking online. The following types of account will all close, although an exact date for this has yet to be set: 

• M&S Current Account

• M&S Premium Current Account

• M&S Premium Current Account with insurance

• Monthly Saver accounts linked to current accounts

M&S bank currently has 3 million customers, although this includes insurance, credit card and loan customers who will not be affected by the change. M&S has confirmed that fewer than 150,000 customers will see accounts closed. 

You'll need to switch or close your account

If you currently bank with M&S, you don’t need to take action straight away. Customers will be contacted with more information in May. But you'll need to take action before August - here are the options:

• Switch to a new provider - and potentially bag free switching cash. You can use the Current Account Switch Service (CASS) to switch to an existing current account you have or to a new current account. This will ensure all your direct debits, standing orders and incoming payments are moved over to your new account. Once you switch, your M&S current account will automatically close. See our Best Bank Accounts guide (and above) for the current best buys, including those paying up to £125 in switching bonuses.

• Close your account. In order to close your account you'll need to have a zero balance, so if your account's in credit you'll need to withdraw the funds first. Once your account's empty, you can close your account via the M&S website, where you'll be asked to fill in its closure form, or you can just wait until August when M&S Bank will automatically close the account and write to you to confirm this.

  Remember, when your account's closed any regular payments will be automatically cancelled, so make sure anyone you make payments to or receive them from has your new banking details.

  If your account has an overdraft, you'll need to clear this first before you can close the account. If you're struggling to do this, see more help below. 

• In your overdraft? Sort what you're doing ASAP. If you're in your overdraft and can't or don't want to clear it, you may be able to switch to another bank, but it depends on whether your new provider will accept your application - see Top Accounts if You're Overdrawn. 

  Whether or not you switch, you should also check if you can reduce what you pay on your overdraft - for full help, see our Cut Overdraft Costs guide.

  If you're still left with an overdraft which you can't pay back, contact M&S on 0345 900 0900 to discuss your options. The bank says help will vary on a case-by-case basis - it could include a repayment plan, for example.

If you have money in your account and don't do anything, then in August your account will be frozen. This means you won't be able to directly access your funds any longer (though you'll still be able to view your account on internet banking or via the app). If this happens, you'll need to contact M&S to either arrange a transfer of your balance to another bank account or for a cheque to be sent in the post. 

M&S also warns those with its Premium Current Account not to close or switch it until April if you're keen to make use of perks, such as hot drinks vouchers worth £132 a year for use in the M&S Café and vouchers worth £40 a year to spend on clothing and homeware. The bank says it's still finalising how to give customers access to these benefits when accounts close for good, and says it expects to have an update next month.

What to watch out for when your account's closed

The M&S Bank website has full info on how account closures will work, but there are a few key points to watch out for:

• You may still be charged interest and other fees you owe after your account's closed. M&S Bank says if interest and charges haven't been applied by the time the account's closed, it'll contact you to let you know the amount owed and that you'll need to repay it.

• Your online statements won't be available after the account's closed. So print off or download any statements you may need.

• You'll be emailed your transaction history going back five years once the account has closed. But you need to tell M&S Bank if your email address has changed. You can also request your transaction history for accounts closed within the previous five years if you need it.

• Insurance cover provided with premium accounts will end when accounts close. If you've an M&S Premium Current Account that comes with travel insurance, this cover will end when your account closes. However, M&S says it is working on a solution to continue to provide this cover without requiring customers to take out a new, standalone policy - it says more info will be available soon. If you need to arrange alternative travel insurance in the meantime, see our Cheap Travel Insurance guide for the best buys.

Monthly Saver interest will be paid for the full term - even if it's closed early

If you had M&S Bank's Monthly Saver linked to your current account, then it will close when your current account's closed. But crucially, if it closes before the 12-month term is up, the bank says to ensure you don't lose out it'll automatically assume a maximum contribution of £250 has been made in each remaining month when it calculates your interest.

When your Monthly Saver's closed, the balance plus interest (accrued and projected) will be transferred to you - we're checking exactly how this works with M&S and will update this story when we hear back. 

If you switch away from M&S Bank, your Monthly Saver will be automatically closed when you do. We're double-checking with M&S whether you'll be paid interest for the full term in every circumstance - including, for example, if your Monthly Saver was due to mature in July and you switch before - and will update this story when we hear back. 

Insurance, loan and credit card customers AREN'T affected

The shake-up only impacts current account customers and those with M&S Bank's linked Monthly Saver. This means customers with the following products are not affected:

• Credit cards

• Loans

• Insurance products

• Savings other than the Monthly Saver linked to current accounts

• Travel money service (M&S Bank's 100 travel bureaux will remain)