Digital bank Zopa launched three new perk options on its Biscuit current account while closing its 7.1 per cent regular saver to new sign-ups.
Under the updated structure, account holders must choose a single reward from a boosted 2.75 per cent variable interest rate on balances, 3 per cent cashback on eating out, or 3 per cent cashback on household bills. Concurrently, Zopa reduced the standard interest rate on Biscuit current account balances from 2 per cent to 1 per cent.
Existing customers who already hold the 7.1 per cent regular saver can continue depositing and withdrawing funds until the end of their six-month term. Once that term expires, their money will automatically transfer into an easy-access pot carrying a variable interest rate of 2.95 per cent. Customers are advised to set a reminder for the term end date so they can move their funds to an account offering a higher rate.
New reward choices and account changes
While the individual perk rates appear higher than before, restriction to a single option reduces the overall versatility of the account. Under the previous model, Biscuit provided a 2 per cent interest rate on current account balances for 12 months, access to the 7.1 per cent regular saver, and 2 per cent cashback on direct debits up to £30 per year. Reaching that maximum annual cashback previously required £125 in qualifying monthly direct debits.
The previous regular saver delivered significant value, as depositing the maximum £300 monthly limit yielded approximately £137 in interest over one year. Under the new rules, customers selecting the eating out perk earn 3 per cent cashback on up to £150 of monthly spending at restaurants, takeaways, and bakeries, capped at £54 annually. Those choosing the bills perk earn 3 per cent cashback on up to £150 of monthly direct debits, also capped at £54 per year. The balance perk boosts interest on current account funds from the standard 1 per cent to an uncapped variable rate of 2.75 per cent.
All Biscuit account holders retain existing core benefits, including a free monthly barista-made drink from coffee chain Caffè Nero and fee-free spending abroad. Zopa operates as a UK digital challenger bank offering lending, savings, and investment products alongside its current accounts.
Industry ratings and expert assessment
Despite the restructuring of features, rates scrutineer Moneyfacts continues to class the Biscuit account as a pick of the week. Moneyfacts tracks interest rates and financial products across the UK banking market to help consumers compare retail offerings.
Caitlyn Eastell, a personal finance expert at Moneyfacts, noted that the account remains a "competitive option in the top 10 when compared to its peers."
Market comparison for savings and cashback
Financial analysts note that while earning interest on a current account balance is helpful, consumers should avoid keeping substantial excess cash in everyday accounts. Dedicated easy-access savings accounts frequently offer significantly higher returns. For instance, Spring's Accelerate Saver pays an interest rate of 5 per cent on balances between £1 and £5,000, making it a viable alternative for surplus funds.
For individuals who already hold at least six months of emergency savings and are willing to accept financial risk in pursuit of higher potential growth, entering the investment market presents another alternative to holding large cash balances in current accounts.
In terms of spending rewards, alternative digital banks offer higher overall cashback limits. Chase, the UK retail banking arm of JPMorgan Chase, provides 2 per cent cashback on everyday spending up to £20 per month, allowing customers to earn up to £240 per year. Eligible Chase transactions cover groceries, restaurants, cafes, takeaways, transport, fuel, and electric vehicle charging.
To qualify for the Chase cashback rewards, customers must make at least 15 debit card purchases per month, hold £1,000 in Chase savings accounts, and deposit at least £1,000 monthly into their account. Maximising rewards requires reaching £1,000 in monthly spending across eligible categories.
Savers seeking to optimize their financial returns across multiple institutions can combine accounts strategically. For example, customers can maintain a Zopa Biscuit account to claim the 3 per cent bills cashback while using a Chase card to earn 2 per cent cashback on everyday purchases.
