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Chase to make big changes to its bank account in April – does it still stack up?

Chase to make big changes to its bank account in April – does it still stack up?

Chase Bank has announced a shake-up to its popular current account. The move impacts both new signups, as well as Chase's existing 1 million UK customers. Below we explain what's changing and how Chase now compares with other accounts.  

See our Best bank accounts guide for the current best buys, which includes up to £200 to switch, up to 7% interest or up to 1% cashback. 

How the Chase account currently works

As things stand, Chase holders get: 

  • 1% unlimited cashback on purchases for the first 12 months. Cashback is added to a 'rewards' pot which can be transferred into another account at any time. (The rewards pot does not accrue interest.) However, while cashback is technically limited to the first 12 months, in reality Chase has continued to pay it to existing customers after the first year.

  • 3% AER linked savings account. This allows unlimited deposits and withdrawals and pays interest monthly, ranking it among the top linked savings accounts currently available. See below and our Top Savings account guide for more on this. 

  • 5% AER 'round-up' pot. Here, if activated, all purchases made with your Chase card are rounded-up to the nearest pound and put in a separate pot. Again, this interest is paid monthly.

How the Chase account is changing for new and existing customers

From April, Chase is introducing 1% AER interest on money in its current account for both new and existing users. There are no deposit or direct debit requirements to earn this. Interest will be calculated daily and paid on the first day of each month.

There's no change to Chase's linked 3% savings account, as well as the 5% interest earned via its round-up feature. Chase is, however, changing the rules of its 1% cashback on purchases offer, which means users will need to jump through more hoops to get it, as we explain: 

If you've been a Chase customer for more than a year: 

  • You'll continue to get 1% cashback on purchases until April – Chase plans to communicate the exact date this change will happen in late March. But from this date, 1% cashback on purchases will be capped at £15 a month AND you'll need to deposit £500 a month into the account to get it. This deposit does not include transferring money from Chase's linked savings account into the current account. To earn the maximum £15 a month cashback you'll need to spend £1,500 a month. 

If you sign-up to Chase between now and 1 May 2023: 

  • You'll get the current offer of 1% unlimited cashback on purchases for 12 months with no deposit required. After a year, you'll be rolled onto the new system above. 

If you sign up to Chase from 1 May 2023, you'll get: 

  • 1% cashback on purchases for 12 months capped at £15 a month with no deposit required. After a year, you'll also be rolled onto the new system. 

How the Chase account now compares 

If you want an account that pays cashback, there are a number of current accounts competing with Chase. We've compared them below, but do read on below the table, as it's likely combining accounts will be most lucrative.

Account details
(links take you to our bank accounts guide for more details)
Monthly cashback after fees on average bills

Chase

 

Now:

 

- 1% cashback on debit card spending for 12 months
- No bills cashback

- No monthly fee

 

From April:

 

- 1% cashback on debit card spending for new custs.
(£500/mth deposit required + £15/mth limit for existing custs.)

- 1% AER interest on money in current account

- No bills cashback

- No monthly fee

Cashback varies according to monthly debit card spend:

 

£500 = £5

£1,000 = £10

 

Interest varies according to amount held in current account:

 

£500 = £0.42

£1,000 = £0.83

Santander 123 (original 123, NOT the Lite)

 

- 1% cashback on council tax, broadband, paid-for TV, phone, mobile and Santander mortgages

- 2% on gas & electricity

- 3% on water

2% AER interest on money in current account (up to £20,000)

- £4 monthly fee

£3.55 (£6.05 with cashback on Santander mortgages)

 

Interest varies according to amount held in current account:

 

£500 = £0.83

£1,000 = £1.67

Santander Edge

 

- 1% cashback on household bills

- 1% cashback on supermarket + transport spending
- £3 monthly fee

£8.80

Halifax Reward

 

- £5/month reward (if you pay in £1,500+ and spend £500+ or keep £5,000 in the account). 

£5

NatWest Reward

 

- £5/month back if you pay in £1,250+, pay out two direct debits & log in to online banking
- £2 monthly fee

£3

Of course, there's nothing to stop you from opening a combination of the accounts mentioned here. For example, you could max out the cashback on both a Chase and Santander account if you have large bills and spend lots anyway. Of course, don't use cashback as an excuse to spend more than you usually would.

If you're willing to change current account provider and are after a cash boost, you could also get as much as £200 for FREE just for switching your current account. It'll take the cashback accounts above two years or more with average bills to earn you as much as that. So, this is where we'd start if you're after a new account: the top current account switching offers.

However, be aware that you can't switch from Chase using this service, so you can only benefit if you switch a different current account.

How does the 3% linked savings account compare? 

While the 3% AER interest on Chase's linked saver is a good rate, it can be beaten. Currently the top payer for easy-access savings accounts is Cynergy Bank. It offers 3.11% (minimum £1) which includes a bonus of 0.15% for 12 months. The account allows unlimited withdrawals with no notice required and it can be opened online.

See our guide on Easy-access savings accounts for more details.

If you're happy waiting three months for access to your cash, you could opt for Invetec's 90 day notice account. It offers a rate of 3.55% interest (minimum £5,000) and can be opened online as well.

Or, if you've less to save, you can get a higher rate by paying lower amounts into a regular saver. The top payer on regular savers open to all is Nationwide, which offers 5% variable for two years. You can withdraw at any time but there's a low maximum deposit limit of £50 a month.

You can find more info in our guide on Regular savings accounts.

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