Consumers looking to earn a little back when they switch and spend may have noticed that some current account providers are shrinking the rewards they have on offer. The reason behind this appears to be down to low interest rates, but other factors could also be dampening activity in this area of the market.

The banks are expected to retain more capital, which could result in them spending less on perks for customers - meaning decreasing and disappearing rewards, as we’ve seen since the start of 2017.

With this in mind, moneyfacts.co.uk reveals the best deals around right now, which could help shoppers choose the most rewarding current account for their monthly spending.

Rachel Springall, Finance Expert at moneyfacts.co.uk, said:

“As banks are urged by the Bank of England to raise capital over the next few years for protection, it is entirely possible they will choose to constrict rewards for current account customers in order to retain more cash.

“Free banking is already a myth as most customers will pay for certain services through fees, and for those accounts that do offer a reward, it seems that time is running out to take advantage.

“NatWest cut the cashback on its Reward account last month from 3% to 2%, while Halifax cut the £5 monthly credit to £3 on its Reward Account in February and Nationwide is expected to raise the monthly fee on its FlexPlus by £3. These changes might not have a huge impact from day one, but consumers will no doubt feel the pinch over the longer term.

“The banks who do still offer cash rewards might not be the best choice for customers who dip into their overdraft occasionally or fail to meet certain eligibility criteria. Whilst the Halifax Reward Account appears to be the best deal for switchers and spenders, their overdraft could wipe out any gains if customers don’t stay in credit, due to its daily usage fees.

“As with any current account, it is vital for consumers to compare the entire deal and switch if they find that their loyalty is wasted. Now is as good a time as any to review finances and get something more rewarding.”

www.moneyfacts.co.uk - The Money Search Engine

Moneyfacts.co.uk is the UK's leading independent provider of personal finance information. For the last 20 years, Moneyfacts' information has been the key driver behind many personal finance decisions, from the Treasury to the high street.

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