Santander 123 current account offers cashback on mortgage repayments

Holders of Santander's 123 current account can now enjoy cashback on mortgage repayments made by direct debit.

The bank will pay 1% cashback to new or existing 123 customers who have a Santander or Abbey for Intermediaries (AFI) mortgage.

The cashback is only paid on mortgage repayments up to £1,000 a month, so you can't earn more than £120 a year.

Existing cashback

However, the 123 current account already pays 1% on water and council tax direct debits, 2% on gas and electricity and 3% on communication bills (things like broadband, mobile phones, landline, etc).

In-credit interest

The 123 account also pays a competitive 3% in credit interest on balances between £3,000 and £20,000. There's a 1% rate on balances up to £1,000 and 2% on balances up to £2,000.

You need to credit the account with £500 every month, set up at least two direct debits and pay a monthly fee of £2 to benefit from the features.

What else?

Santander has also revamped the Santander 123 World credit card by offering 3% cashback on travel spends like train fares. This is in addition to the 1% that can be made on your spend in supermarkets and the 2% cashback at department stores.

According to Santander, British households could make as much as £1,000 a year in cashback and interest with the 123 Current Account combined with the Santander 123 Credit Card.

Alternatives

Other current accounts also offer tempting incentives and rewards.

The Halifax Reward Current Account gives you £5 cashback just for paying in £1,000 a month. That adds up to £60 a year just for using the account!

Elsewhere First Direct pays £100 if you switch to its 1st Account and is willing to pay an extra £100 if you're not completley satisfied once you move. You could also earn as much as 4% in interest from the Lloyds Vantage current account.