Switching Bank Accounts
Switching bank accounts is a relatively simple process, but one that many consumers tend not to do, usually down to a sense of loyalty to the banks they bank with.
Bank accounts are a little like car insurance, riddled with great offers for new customers and often not the best deals for existing ones. Throughout the year providers will offer cashback for switching accounts, as much as £100 in some cases, and will also offer better interest rates on accounts in credit for new customers.
Consumers have historically found switching bank accounts to be a difficult process, with many gas, water and electricity companies dragging their heels when changing direct debits, and the old banks tending not to send details to the new banks immediately.
This has changed recently, and banks must now release to the new bank all the information needed to switch account in less than 3 days, with the average account fully transferred in eight days.
Banks will offer to move all your direct debits from your old account free of charge, as an incentive to open a new account and because you are more likely to use your new account if you have your direct debits transferred for you.
When choosing to compare bank accounts, be sure to weigh up all the options available to you. Customer service is always important and you’ll want to make sure you’re looked after if anything goes wrong.
Use our reviews to assess the quality of service offered by the bank before moving to them. It’s also worth looking at the bonus for moving to the account, which can be anything from cashback to free breakdown cover for a year.
It is also worth looking at the interest rate offered on credit balances and charged on overdrafts. If your account is nearly always in credit, you will want an account with good credit interest. If you are always in overdraft, look out for accounts that offer free overdrafts, and no fees if you exceed that overdraft.
Some offers are subject to paying in a minimum amount each month, so be sure to read the terms and conditions before switching.