The Banco Santander-owned bank, which is the third largest in the UK, said the decision was due to feedback from customers who said dealing with an offshore call centre was a "frustration that can lead to dissatisfaction".
Abbey, as it was known at the time, outsourced its call centres to India in 2003.
The bank's move is said to be creating 500 jobs at centres in Glasgow, Leicester and Liverpool, to deal with the 1.5 million calls it receives each month.
Its customer-service drive comes after Santander was unveiled as the most-complained-about bank in the UK by the Financial Services Authority.
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