Santander 123 Account

CUPCAKESUE

Hi

Just in the process of opening a Santander 123 account. My application has been successful so just waiting for my account number and card to come through.

I have read that you have to fund the account with £500 per month and set up at least two direct debits per month, does anyone know if you can use the £500 to pay the direct debit bills such as council tax, Energy bills or do you have to leave the £500 in as savings.

I will be paying in a lump sum to get the 3% interest as well.

Thanks

Ifts

CUPCAKESUE wrote: »

I have read that you have to fund the account with £500 per month and set up at least two direct debits per month, does anyone know if you can use the £500 to pay the direct debit bills such as council tax, Energy bills or do you have to leave the £500 in as savings.

Yes thats fine to use the £500 to pay the direct debits with (you don't have to leave the £500 in as savings).

CUPCAKESUE

Thank you for the information

badger09

I'm not sure what you're asking here

If you pay in a lump sum, which you call 'savings' and then £500 a month, it will increase your balance.

Your direct debits, other payments, debit card spending and withdrawals will reduce that balance. If your expenditure is more than £500 a month, your 'savings' will reduce - if expenditure is less than £500, 'savings' will increase, but they are not kept in separate pots:cool:.

If you wish, you can pay in £500 each month and immediately withdraw it.

Sorry if I'm answering a question you didn't ask

Milarky

If the OP's concern is how to avoid an excess balance (e.g. not earning interest if the account is above 20k), simple. Open a second account.

The main thing to take care with, is that at least 2 DDs must be 'set up' (that is, showing on the list held at Santander online banking) BEFORE the time of monthly statement comes out - even by a single day. Once interest has been paid a first time, however, you can be assured the account will continue to remain eligible for interest and just keep the £500+ monthly credit coming.

moneyfoolish

With so many people going for this account can the interest rate be maintained for very long?

talexuser

russell_anderson wrote: »

With so many people going for this account can the interest rate be maintained for very long?

Interesting question, we shall see. However the readers here are not a lot compared with the total UK banking population, so maybe we shall have some more months of good interest. It depends when Santander reach their target of new accounts/market share I suppose.

grizzly1911

Milarky wrote: »

If the OP's concern is how to avoid an excess balance (e.g. not earning interest if the account is above 20k), simple. Open a second account.

The main thing to take care with, is that at least 2 DDs must be 'set up' (that is, showing on the list held at Santander online banking) BEFORE the time of monthly statement comes out - even by a single day. Once interest has been paid a first time, however, you can be assured the account will continue to remain eligible for interest and just keep the £500+ monthly credit coming.

If the customer cancelled the DDRs would interest still be paid?

rb10

russell_anderson wrote: »

With so many people going for this account can the interest rate be maintained for very long?

With the interest rate forming part of the name of the account, it'd be a tricky one to change. The '1-2-2.5' account doesn't quite have the same ring to it...

talexuser wrote: »

Interesting question, we shall see. However the readers here are not a lot compared with the total UK banking population, so maybe we shall have some more months of good interest. It depends when Santander reach their target of new accounts/market share I suppose.

With over 1,000,000 new Santander 123 accounts opened each year, they are certainly growing balances rapidly.

I don't think Santander will be looking to stop growing their current account customer base particularly soon. They like their 123 customers - they typically hold lots of other products and they are generally more affluent than the general population.

eskbanker

grizzly1911 wrote: »

If the customer cancelled the DDRs would interest still be paid?

Not according to their Ts and Cs (section A4):

To earn cashback and credit interest on your 123 Current Account, you must:
a) pay the monthly account fee; and
b) pay in a minimum amount into your account each month; and
c) have at least two Direct Debits set up on your account; and
d) for earning credit interest only, you also need a minimum current account balance

.

billchecker1

Please note that the maximum you can get interest on is 20K.

I had the esaver before at 3% and had 40K. Need a home for the other 20K now.

Already have maxed out Natiowide X2, Lloyds Vantage X3 and am dripping into a first direct regular saver.

Anyone have any more ideas?