Santander updates interest rates on its current account, savings, and mortgage products

Santander UK has today announced changes to its in-credit interest rate on 1I2I3, Select and Private current accounts.  It has also announced increases in rates to its savings and mortgage products, following the Monetary Policy Committee decision to increase the Bank of England base rate by 0.25% to 1.25%.

Santander UK will make the following changes: 

•    All Santander tracker mortgage products linked to the base rate will increase by 0.25% from the beginning of July. This includes the Santander Follow-on Rate (FoR) which will increase to 4.50%. 
•    All Alliance & Leicester mortgage products linked to the base rate will increase by 0.25% from the beginning of August.
•    The Alliance & Leicester and Santander Standard Variable Rates (SVRs) will increase by 0.25% to 5.49% from the beginning of August.
•    Santander savings products that are linked to the Bank of England base rate will increase by 0.25%, effective from 4 July. The products linked to the base rate are the Rate for Life and Good for Life savings accounts. 
Current Accounts:
•    Our 1I2I3, Select and Private current accounts are not linked to the base rate but, from 20 June 2022, the in-credit interest rate will increase from 0.50% AER/gross (variable) on balances up to £20,000 to 0.75% AER/gross (variable) on balances up to £20,000.  
•    The increase in the in-credit interest rate means customers will be able earn up to £150 per year in interest, plus up to 3% cashback on household bills1 paid by direct debit, for a £4 monthly fee.  The cashback and monthly fee are not changing.
•    The 1|2|3 Current Account remains the only current account in the market to offer customers cashback on household bills and interest on their balance.

Hetal Parmar, Head of Banking and Savings at Santander UK, said: “We’re pleased to be able to increase the interest rate on our popular 1I2I3 Current Account. Customers can continue to earn cashback on regular household bills plus cashback on card spending at a range of retailers through our Retailer Offers programme, and now, increased interest on their balance.”  

Any future changes made to other savings products which are not linked to the base rate, will be communicated to customers separately. 

Santander offers other competitive saving rates, including 2.50% on the 123 Regular eSaver and 3.00% on 123 Mini (for children and young adults). 

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The information contained in our press releases is intended solely for journalists and should not be used by consumers to make financial decisions.

Editors notes
1  Details of cashback on household bills
1% (capped at £5)    

  • Council tax bills
  • Mobile and home phone bills, broadband and paid-for TV packages
  • Santander monthly mortgage payments

2% (capped at £5)    

  • Gas and electricity bills
  • Santander Home Insurance premiums (policies administered and underwritten by Aviva Insurance Limited)
  • Santander Life Insurance premiums (policies administered and underwritten by Aviva Life & Pensions UK Limited)

3% (capped at £5)    

  • Water bills

Santander UK is a financial services provider in the UK that offers a wide range of personal and commercial financial products and services. At 31 December 2021, the bank had around 19,200 employees and serves around 14 million active customers, via a nationwide branch network, telephone, mobile and online banking. Santander UK is subject to the full supervision of the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA) in the UK. Santander UK plc customers’ eligible deposits are protected by the Financial Services Compensation Scheme (FSCS) in the UK.

Banco Santander (SAN SM, STD US, BNC LN) is a leading retail and commercial bank, founded in 1857 and headquartered in Spain. It has a meaningful presence in 10 core markets in the Europe, North America and South America regions, and is one of the largest banks in the world by market capitalization. Its purpose is to help people and businesses prosper in a simple, personal and fair way. Santander is building a more responsible bank and has made a number of commitments to support this objective, including raising over €120 billion in green financing between 2019 and 2025, as well as financially empowering more than 10 million people over the same period. At the end of 2021, Banco Santander had €1.15 trillion in total funds, 153 million customers, of which 25.4 million are loyal and 47.4 million are digital, 9,900 branches and 197,000 employees.