Another Santander 123 question

Freecall

Can somebody confirm whether it is necessary to actually use a Direct Debit on a 123 account in order to qualify for interest?

The terms say Set up a minimum of two Direct Debits. For cashback household bills must be paid by Direct Debit to organisations within eligible categories which suggests that as long as two DD's are set up that is sufficient, payments do not actually have to be taken.

It seems straightforward but if that is the case then I can't see why they bother with the requirement.

YorkshireBoy

They only have to be "set up", ie listed on your account.

However, if you don't pay any qualifying DDs you won't get any cashback to offset the £24/annum fees and this will act to reduce the effective return. Even with £20K in there the gross return is cut to around 2.88%...and there are better returns to be had elsewhere, ie a 'clean' 3% at TSB, Lloyds, BoS and a 'clean' 5% (albeit for a year only) at Nationwide.

Freecall

Thanks YorkshireBoy that fits with what the T's&C's say.

The reason that I was checking is that I set the account up to hold £20k with 2 DD's some time ago and all is going well but I am aware that one of my DD's (Council Tax) only takes funds over 10 months not 12.

I did not want to miss out on interest.

macman

The purpose is to 'encourage' you to use the account as a sole current account, and not as a high interest savings account for up to £20K. However, as many of us have found, there are ways around this with S123.

agentk

hi sorry to disagree with the comments of previous posters but

I opened a 123 august 27 set up two dd one for water and one for talk talk deposited 10k over the coming week. no intrest has been credited to date. called santander to ask why to be told although the dd are showing and have been since the first week of opening .no intrest because dd were not debited september . I paid by card the demand letter that you recieve when you cancel youre dd .From another bank:mad: roll on the end of the month then.also as other posters have said beware the calender/month of opening bit.

If i have been informed wrong and other posters are right i will be the first one to put a rocket up their..........

Archi_Bald

agentk wrote: »

If i have been informed wrong and other posters are right i will be the first one to put a rocket up their..........

There is nothing in the T&Cs that say your DDs must pay every month. I have 2 accounts with "dummy" DDs myself and they pay interest every month like clockwork.

It's more likely you didn't get any interest because something seems to have gone wrong with at least one of your DDs?

agentk wrote: »

I paid by card the demand letter that you recieve when you cancel youre dd .From another bank

Do the DDs show in your online banking?

agentk

yes dds have been there all along dd all showing i have added another to a tesco dump acc for £1.00 lol this month it was showing next day. The santander lady said its because the dd where not paid.
and stated its to discurage abuse of the 3% rate. I will double check dd dates (the reason for adding a third)re anniversery month date. gutted as i moved funds from the mysave online when better rate ended would have been better leaving it there for the lower rate

thanks archibald and others for youre help seems like i might have to make another call:mad:would could they have changed t&cs since.

agentk

oppps dds were listed 1st and 2nd of sept guess that means no interest for september then. I take they they only use full months after dds are active. but still:mad

Gromitt

agentk wrote: »

oppps dds were listed 1st and 2nd of sept guess that means no interest for september then. I take they they only use full months after dds are active. but still:mad

Nope, I remember opening my account on the 20th, DDs were setup same day, and I deposited £500 on the 26th, and £500 on the 1st of the following month, I got the £2 banking fee on the 20th the following month and 3p interest, so I shoved another £19500 in there and got £29 interest the following month. No way was I going to shove the entire 20K in there until I knew I was going to get interest on it.

agentk

mmmm cheers looks like a bit of light reading tonight t&cs and working out dates dosent help that a santander month is different from ours.

thats the reply i got from santander lady. although i know she is not infallable but surely their system would be

on a side note i upgraded my rarelly used lloyds acc over the phone to vantage 3%. i mention i was expecting some money savings she said would i not be better opening a savings acc:rotfl:

agentk

just called santander think its cleared up:j

acc opened 19/08 i did not credit acc till i got card/ letter etc and did not get it over £1000 interest kick in amount till around the 9th 09

so my acc anniversary 19 oct should get settlement then.

many thanks to all .sorry OP for hijacking post hope it is helpful to others.

off to eat humble pie. thanks santander lady