M&S Monthly Saver Now Open to Standard Current Account Holders

Written by Karen Bryan

M&S bank debit cardM&S Bank now offers holders of its free standard current account access to the M&S Monthly Saver account, which pays a fixed interest rate of 6% on monthly deposits of between £25 and £250. Previously, only holders of an M&S Premium Current Account had access to the Monthly Saver.

Earning 6% interest is a great perk, as the highest rate of interest which I could find on a one year fixed rate account was 1.85% with the ICICI Bank.

However, remember that you can only earn interest on money in the Monthly Saver account. If you deposit the maximum £250 a month, your final balance will be £3,000, but you will only earn the 6% interest on the average amount in the account, i.e. 6% of £1,500.

You need to make the monthly payments by standing order from your M&S current account. You can vary the monthly deposit, as long as you pay in the minimum of £25. If you pay in less than the maximum £250 in any month, you can carry forward any unused allowance to the following months.

You need to be sure that you can tie up your cash for 12 months, as the only way to access the money in an M&S Bank Monthly Saver is to close the account. You’ll be penalised by a reduction in the rate of interest paid. It says on the website that you’ll be informed of the lower early closure rate of interest when you open the account. When I asked the rate during the phone conversation to open the M&S Monthly Saver, I was told it was 1.35%. I don’t understand why they don’t tell you this rate on the M&S Bank website.

You can earn £100 in M&S vouchers if you fully switch your current account to the M&S Bank. If you’re a regular M&S shopper, another perk is earning one point per £1 spent on M&S purchases, in-store or online, when you use your M&S debit card for payment. Customers receive £1 in M&S vouchers for every 100 points earned.

Rates of interest correct on 11 January 2015.