The high street giant is going to compete with the big boys, with a £100 incentive for switching.
Marks & Spencer has announced that M&S Bank will launch a fee-free current account this summer with a £100 welcome bonus.
The bank already offers two Premium current accounts which both charge a monthly fee. It says the success of these and the introduction of seven-day current account switching has prompted it to launch a free account.
What the new M&S current account will offer
Much like the Premium accounts M&S already offers, the forthcoming M&S current account will be of most benefit to people who like shopping at its stores.
If you switch your current account to the new M&S account using the Current Account Switching Service, you’ll receive a £100 M&S gift card.
The account also offers:
- an automatic £500 overdraft, of which the first £100 is free and the remainder is charged at 15.9% EAR;
- one loyalty point for every £1 spent in-store or online using the M&S account debit card (100 points equates to £1 in M&S vouchers, so it’s a penny in points for every pound spent);
- no transaction fee on overseas ATM withdrawals, although there will be a 2.75% foreign exchange charge;
- exclusive offers on other M&S Bank products.
The account will be available to existing M&S Bank customers first, before being rolled out fully.
M&S Bank branches are open the same hours as stores, and customers can ask to be paged elsewhere in a store when a member of bank staff is available to see them instead of waiting in the branch.
What M&S current accounts offer now
[SPOTLIGHT]If you’re a big fan of M&S, you might already benefit from one of its two Premium accounts. The M&S Premium account costs £10 a month but offers £222-worth of vouchers and gifts. You can also earn loyalty points when you spend in-store and online using your debit card. There’s also a fee-free £500 overdraft, of which the first £100 is also interest free.
The M&S Premium account with insurance costs £17.50 a month and offers all the benefits above plus worldwide family travel insurance for any family member under the age of 70.
Before you sign up for the account with insurance though make sure you can’t buy it cheaper separately elsewhere, particularly if you’re not jetting off anywhere far away.
These premium accounts offer £150 worth of M&S gift cards as an incentive. You get one worth £50 when you sign up and another worth £100 once you've completed a full switch using the Current Account Switch Service.
Other current accounts with incentives
M&S is entering a very competitive market when it comes to introductory incentives. First Direct, Halifax, the Co-operative and the Post Office (the latter only in limited areas for now) are all offering £100 cash (plus £25 to charity in the Co-op’s case) when you switch your main current account to them. All offer other benefits too, ranging from free overdrafts (First Direct and the Co-op) to £5 a month cash reward (Halifax).
Meanwhile, Nationwide is offering £50 if you get a friend to sign up to one of its current accounts. They get £50 too.
More on banking:
Why some current accounts beat top savings accounts
Best buys that are only for banks and building societies' existing customers