The US bank Chase has launched its first current account in the UK, prompting one analyst to say it “will blow the competition out of the water”.
Offering 1% cashback on everyday spending for the first 12 months, free card use abroad, including at ATMs, and 5% interest on limited savings, the deal may be an attractive option for Britons who have seen their current account benefits slowly whittled away.
Chase, which is JP Morgan’s consumer brand, already provides banking to 60 million households in the US.
Its UK offer is a digital-only, app-based account, making it a rival to firms such as Monzo and Starling.
Prospective account holders are being invited to register on its waiting list. The bank says it is taking a “controlled approach” to manage demand, and those who sign up should be able to become a customer within days.
The account has no fees or minimum monthly deposit but there are restrictions on the 1% cashback offering.
Users will not get cashback on big-ticket purchases such as a car, or on money spent gambling.
When customers spend money, they can round up purchases to the nearest £1 using a setting that can be switched on and off with the app. This pot then earns interest at 5%.
Unusually, the account comes with a numberless debit card, with the details stored behind a secure login on the app. This means a new card number can be generated straight away if it is reported lost.
Laura Suter, the head of personal finance at AJ Bell, said it could be a winner. “First impressions are that this new account will blow the competition out of the water, with an attractive cashback deal and a market-beating interest rate on its savings feature,” she said.
“Assuming the cashback is uncapped, the rate means that if someone spends £500 a month on their debit card they’ll get £5 back.”
Suter said there would be drawbacks for the account for some customers because it does not have any bank branches, all the help and customer support is online or on the phone, and it must be run from an app.