NEW Tesco Current Account - 3% on £3,000

bsms1147

Tesco are launching their new current account. Rather than bump one of the hundreds of 'When are Tesco launching their new current account?' threads, I thought I'd start a new one so this first post can be informative and have a FAQ added if and when needed.

http://www.tescobank.com/current-accounts/index.html?tpfpgid=tb-home&navid=carousel-slide1

- 3% interest (3% AER variable/2.96% gross) on up to £3000
- 1 clubcard point for each £4 spent in Tesco/£8 spent elsewhere (equivalent 0.25% and 0.12% cashback respectively; up to 1% and 0.5% if points are boosted)
- Free if £750 is paid in each month, otherwise £5 a month fee applies
- 18.9% EAR arranged overdraft cost (no monthly, daily fee)
- £5 per transaction/£50/month unarranged overdraft fee
- No Direct Debit/Standing Order requirement

I think the card is alright

bsms1147

Lets compare it to other accounts;
- You can earn 5% AER on £2,000 in one TSB Classic Plus account; on £4,000 if you hold two; and on £12,000 if you're part of a couple and open six.
- Cashback on debit cards is relatively uncommon. However M&S who recently released a current account of their own have points equivalent to 1% instore and 0.5% on spends elsewhere. Like Tesco, these points can only be spent in the provider's store, in that case M&S. Alternatively you can get better rates - and often receive cashback as pure cash, spendable anywhere - with credit cards.
- Everyone will be able to avoid the £5/month fee, even if it means sending and receiving £1 back and forwards 750 times. The TSB Classic Plus, as a contrast, is fee-free.
- Many banks require you to set up and maintain DDs or SOs, so it's nice to see Tesco not requiring them.

So should I get it?

Sadly, I feel the answer for most, is no.

Frequently Asked Questions

How many accounts can I have?
You can't have more than two Tesco Bank Current Accounts whether solely or with another person

Will internal transfers (transfers from another Tesco account in my name) satisfy the £750 funding requirement?
Yes

Will I receive interest if my balance exceeds £3,000?
You will only receive interest on the first £3,000 in the account. Anything over this will not gain any additional interest, and this extra amount would be placed elsewhere.

thegreenmonkey

Happy with 3% credit interest, which is more than the amount they were considering several months ago. Good timing as it helps with the loss of Lloyds Vantage.

matty_544

England, Scotland, Wales only. Look like the Tesco are excluding those who live in NI.

socrates

Application process is glitchy - already....

GooliesOfFire

Nothing special really.

socrates

Application completed - semi linked with online banking during application process - waiting to receive papers to sign

LeeBalders

I'm underwhelmed after all the anticipation - I'll be saving my sacrificial switcher account for Halifax Rewards as planned, and probably get the TSB accounts before this one. Tesco can be third in the queue.

Fruit_and_Nut_Case

Got my quota of Nationwide and TSB accounts already so this is a logical next step.

Fruit_and_Nut_Case

Looks like you can have two Tesco current accounts. During the application process it asks if you have "more than one" already.

YorkshireBoy

Fruit_and_Nut_Case wrote: »

Looks like you can have two Tesco current accounts. During the application process it asks if you have "more than one" already.

Confirmed in their FAQ...

http://faq.tescobank.com/help/current_account/accounts_number