Santander is raising interest on its 123 Current Account later this month with the bank boosting 0.2 percentage points to 0.5 per cent.

The change will commence from March 28 when customers can take advantage of higher interest on their cash.

Rachel Springall, a finance expert at, said: "It's good to see Santander increasing the rate on its 123 current account to 0.5% as the deal also comes with a great package of incentives including cashback on bills and spending, so it's attractive for both spenders and savers.

"However, the interest rate was slightly higher a year ago (0.6%) before it dropped to 0.3%.

"At present, for a monthly fee of £4 consumers can earn 1% to 3% cashback on selected household bills and on Santander home or life insurance premiums (up to £15 per month).

"Santander is also offering switchers £140 cash and, as the cost of living rises, consumers may be tempted to grab a free cash perk, but it is imperative they weigh up the overall package of any account before they commit and be sure it suits their needs."

Virgin Money M Plus Account pays 1% interest

Ms Springall highlighted other banking options people could consider when trying to make their money go further.

"Virgin Money's M Plus Account offers some decent perks alongside the linked M Saver account, but, as with any package, the benefits are pointless unless someone uses them regularly," she said.