Zopa, the UK-based digital bank, has launched its first current account, allowing users to earn up to £256 a year through a combination of cashback and interest.

The account, Biscuit, pays 2% annual interest on all balances and offers 2% cashback on household bills paid by direct debit, capped at £1,500 of direct debits per year. Additionally, customers can access a linked regular savings account with a competitive 7.10% interest rate on deposits up to £300 per month. After 12 months, the regular saver converts to an easy access account with a 3.5% rate, and customers can open a new regular saver to continue earning the higher rate. Jaidev Janardana, CEO at Zopa Bank, said: "Stepping into everyday banking is a natural next step in Zopa's mission to build the Home of Money for its customers.

"We believe that British consumers deserve better than having to constantly chase deals and accept complexity or a poor experience. All our products are designed to provide good value and ease, and our new bank account is another great example of this philosophy."

Zopa says Biscuit is designed to simplify everyday banking while delivering strong value, targeting consumers who typically juggle multiple accounts to maximise rewards or avoid fees.

The account can be opened quickly via Zopa's app, with instant access to virtual cards and the ability to link external accounts for consolidated money management.

Zopa holds a full UK banking license, meaning deposits up to £85,000 are protected by the Financial Services Compensation Scheme.

The launch comes as a Zopa survey found that nearly a quarter of people actively seek cashback deals, and about a fifth maintain multiple accounts to find value or avoid fees.

Zopa says the new account aims to bring together everyday spending and saving in one place, reflecting customer demand for both convenience and better returns

The bank's entry into the current account market comes amid strong financial performance, with the company doubling pre-tax profits to £34.2 million in 2024 and planning to expand its headquarters later this year.