Following new current account switching rules Lloyds joins Halifax, RBS/NatWest and Santander to offer cashback
Lloyds is the latest bank to jump on the cashback bandwagon, with a scheme allowing its current account holders to earn back up to 15% of what they spend. In particular it may appeal to those who do their weekly shop at Morrisons or Ocado, or could be tempted to use them.
Britain’s high street banks are jockeying for position following the launch in September of new current account switching rules, and have clearly decided that cashback is one of the best perks when it comes to keeping hold of existing customers and winning new ones.
Lloyds bank’s move comes weeks after Royal Bank of Scotland/NatWest and Halifax launched cashback schemes. They may have been influenced by Santander, which has enjoyed huge success with its 123 current account, where customers get cashback on their household bills.
Lloyds will launch its scheme, called Everyday Offers, later this month, allowing its millions of current account customers to earn on spending at selected retailers. This initiative – similar to one launched by the Halifax in August – will let people earn back between 5% and 15% when they shop at retailers ranging from Morrisons and Ocado to Homebase and Argos.
There are 18 retailers on the list so far, and by the end of this month, customers will start to see the offers appear when they do their online banking. However, some of the details as to who will be offered which deals are sketchy. Offers will be tailored to individuals, so not every customer will receive the same offer from the same retailer.
Customers will have to activate their offer, which will have an expiry date. Once they do that, they will earn cashback on that transaction by using their debit or credit card. This money will be paid into their current account at the end of the following month. While each offer will have its own terms and conditions, the good news is that it appears that, to start with at least, there will be no cap on the cashback that can be earned per transaction. To take part customers have to be registered for internet banking. “As long as they use their debit card, we expect that they’ll see a number of different offers each month,” says a spokeswoman.
Lloyds bank is also launching a lottery-style scheme called It’s On Us, available to everyone who has registered for Everyday Offers, where it will randomly select transactions that will be repaid to people’s current accounts. One thousand purchases a week will be repaid, up to a value of £500.
Halifax is part of the Lloyds banking group. It has launched a scheme for its current account holders called Cashback Extras, which offers payments of between 5% and 15% on purchases made using debit and credit cards at selected retailers. Its partners also include Morrisons, Ocado, Homebase and Argos.
The bank said customers could make more than £100 a year “simply by buying the things they already spend money on”.
The banks recently launched the Cashback Plus Loyalty Programme. This offers 1% cashback on debit card purchases at a selection of retailers, including BP petrol stations and cinema chain Cineworld, and the banks said more than 12 million existing customers, plus any new people switching, are able to earn rewards.
As a launch offer, NatWest and RBS customers can earn 1% back on debit card spend in Tesco stores until the end of June 2014. The bank was quick to emphasise that this offer “is provided direct from RBS/NatWest and is not in any way endorsed, sponsored, sold or promoted by Tesco, or otherwise implemented with Tesco’s co-operation”.
A bank spokeswoman recently revealed that one NatWest customer spent £2,299 at jeweller H Samuel on a diamond ring for his wife, and received £229 cashback. “He chose to partially trade up the rewards and more than doubled their value on eight Cineworld tickets. For £20 in rewards he received £56 worth of cinema tickets, still leaving £209 in rewards left to spend.”
Customers need to register online to take part. Basic bank account holders are excluded.
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