First Direct is tempting new customers with a generous £175 switching bonus for its current accounts, reigniting the cash incentive trend in a market where such deals have become scarce.

The bank experienced a surge in uptake when it initially introduced the offer for a four-week period at the end of March.

To qualify for the £175 reward, individuals must satisfy certain conditions, including depositing a £1,000 balance, transferring a minimum of two standing orders or direct debits, and making at least five debit card transactions within the first 30 days after opening the account.

The switch must be completed using the official Current Account Switch Service (Cass) to transfer their banking operations to be eligible for the £175 bonus.

First Direct promises that customers who meet the criteria will receive their bonus by the 20th of the month following the completion of the requirements.

While First Direct has not specified an end date for the £175 switch incentive, Chris Pitt, the CEO, emphasised that the offer "will only be around for a limited time only".

Additionally, to be eligible for the bonus, customers must not have previously held any First Direct products or opened an HSBC current account since January 1, 2018.

This latest move by First Direct may set the stage for a resurgence of new switching incentives in the current account sector.

Virgin Money has recently launched a new current account switching offer, promising switchers to its M Account, M Plus Account and Club M Account a bonus interest rate of 10 percent gross fixed on current account balances up to £1,000 for a year from July 1 2024 to June 30 2025.

Moneyfactscompare.co.uk has noted that several other banks, including NatWest, Lloyds Bank and Santander, have ceased their cash switching offers, some of which were as high as £200.

Rachel Springall, a finance expert at Moneyfactscompare.co.uk, commented: "After a short absence, First Direct has reintroduced its £175 switching cash offer, which may entice consumers looking for an upfront sweetener."

"The fuss-free 1st Account may be suitable for those who use their overdraft from time to time, thanks to its £250 interest-free buffer. Not only this, but those looking to kick-start the savings habit will have access to its regular savings account which pays a competitive seven percent."