Digital bank Zopa has entered the current account market with its new Biscuit account, offering 2.0% annual equivalent rate (AER) interest on balances. Customers can also earn 7.10% interest on a linked savings account by depositing up to GBP 300 monthly. After a year, the regular savings account transforms into an easy access savings account with a higher rate of 3.50%. Moreover, individuals can enjoy 2% cashback on direct debits for bills up to GBP 1,500 annually.

Survey Insights

Zopa’s Biscuit aims to provide more value by integrating daily savings and spending. A survey conducted among 2,000 British individuals found that nearly 24% of people are attracted to cashback offers. Similarly, 19% have multiple bank accounts to find better deals, avoid fees, and reward their loyalty. About one-third prefer keeping a substantial portion of their bills and outgoings close to payday for better financial management. Additionally, 12% save money by not spending on specific days each week, while 37% rely on mobile banking to keep track of their finances.

Market Trends

According to representatives from Moneyfactscompare.co.uk, the trend of challenger banks offering current accounts is gaining traction. Digital banks provide innovative alternatives that benefit customers by complementing those who prefer simpler account solutions for various financial needs. However, it’s important for customers to calculate their potential earnings accurately.