Zopa launches 2% cashback current account plus 7.1% regular saver

Read our review of the Biscuit current account from Zopa

Biscuit, a brand new current account from Zopa has been tested in beta for a little while, with three different accounts on offer, but it looks like Zopa’s decided on one to roll out to the public. Here’s how Biscuit works, how it compares to other cashback current accounts on offer and our verdict.

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What is Biscuit?

Biscuit is Zopa’s first ever current account. The account is free and you can manage it entirely on the app. It offers a number of perks including cashback on your spend, a linked regular savings account, interest on your balance and fee-free spending abroad. 

Zopa’s marketing department has been busy, putting out claims that the account will fill a “huge gap in the market”, being both “tasty” and “uncomplicated”.

But, in our view, while there’s some features that are ok – and one that’s quite appealing, there’s nothing particularly revolutionary about it. 

Biscuit account features 

Here’s a run-down of everything you get with the new current account from Zopa. 

Interest on balance

You can earn 2% on your current account balance, which is unlimited. This 2% is a far cry from the top savings rates and current accounts at the moment, so we’d prioritise putting your spare cash in those if you can. But it pays some interest on balances you plan to use imminently. 

Cashback

We’ve seen a number of cashback deals dwindle recently, with Chase watering down its offer so you earn less and Santander getting rid of its 1% Edge and Edge cashback altogether from September.

So we were initially excited when we saw Zopa’s Biscuit account offering what sounded like a generous 2% cashback on bills. However, at a closer look you’ll find this is only paid on up to £1,500 of direct debits per year. So, the maximum you can earn is £30 per year on your bills — or £2.50 per month. Which is piddly.

There are a number of other accounts that offer better cashback earning potential including Chase (despite the changes) and even the Trading 212 card. 

Regular saver: earn 7.1%

Now, while the Biscuit cashback and interest rate aren’t exactly impressive, one perk that is pretty decent is the linked regular savings account – which may prove to be the biggest draw.

It pays a variable rate of 7.1%, which is currently the highest rate on offer over a year. 

With this savings account, you can save up to £300 per month, earning a maximum of £137 over a year, assuming the rate doesn’t change. But as it’s variable, it could well do.

Now, Principality does have a regular saver that pays 7.5% but only for six months, and First Direct and Co-op Bank aren’t far behind Zopa’s regular saver, with rates of 7%.

The First Direct account has the slight edge over Co-op Bank as you can pay in £300 a month (Co-op Bank limits you to £250 a month) and most importantly, the 7% rate is fixed for the year – so it’s guaranteed for that period of time.

To say on top of the best accounts, check out our regular saver page which we update weekly.

Fee-free spending abroad

You can use Biscuit abroad at no extra cost. You get the real Visa exchange rate and can withdraw up to £200 each month (with a 2% fee for amounts over this).

Some other banks offer higher withdrawal limits, with Chase letting you withdraw up to £500 per day, and Monzo letting you withdraw £400 per day. Most other accounts use the Mastercard exchange rate, which is usually slightly more favourable, but it’s negligible. We have a full round up of the best debit and credit cards to use abroad.

How to open a Biscuit account

If you want to open a Biscuit current account, you’ll need to download the Zopa app on either the App Store or Google Play. 

Once you’ve downloaded it, you select the “Open account” button and go through a series of questions. These are all pretty straightforward, with questions you should already know the answers to, and it only takes about five minutes. 

You’ll also need to take a photo of your ID and take a selfie as part of the sign-up process. Zopa will perform a soft search on your credit report for identification. 

Eligibility

To get a Biscuit current account, you need to be 18+ and a UK tax resident, excluding the Channel Islands and the Isle of Man. 

You’ll need to have an ID to hand for the ID checks.

Is Biscuit safe?

Zopa is protected by the Financial Services Compensation Scheme which covers £85,000 of your deposits if Zopa were to go bust. But you’ll need to consider any money you already hold with Zopa, such as in savings, as the £85,000 includes all accounts overseen by Zopa. 

You can get 24/7 support with its in-app chat and telephone support. You can freeze and unfreeze the card within the app. 

Pros and cons

Pros

• High paying linked regular saver paying 7.1%. However, this account is variable, so you want to keep an eye on the rate and move your money if the rate drops.
• Get an instant virtual card after applying
• 2% interest on all balances
• 2% cashback on bills

Cons

• No branches
• You can’t deposit cash
• You can’t use the Current Account Switching Service (CASS)

Is Biscuit any good?