A new current account switching service launches in September, aiming to make it quicker and easier to switch banks. If you could switch within seven days would you ditch your bank?
Last month we revealed only 2% of consumers had switched bank account in the past year, whilst half of those surveyed had never switched at all.
Among some of the reasons given from people that had never switched, 48% said that moving to a new bank wouldn’t make enough difference, whilst a third felt that changing account was too much hassle.
Seven days to switch bank accounts
The process of switching bank differs considerably depending on the bank. It can take anything from 18 to 30 working days.
The new service will reduce the time it takes to switch to seven working days from account opening. All ingoing payments (e.g. salary) and outgoing payments (e.g. Direct Debits and standing orders) will be transferred to the new account. And any old payments made to the old account will be redirected to the new account for a period of 13 months.
On top of this, customers will be given a ‘Switch Guarantee’ which will mean they will be refunded for any interest and charges if anything goes wrong with the switch.
Refunds on charges if something goes wrong
For those feeling the hassle is the hindrance I wonder if new switching may be the catalyst needed. I must confess, I fall into the group of having never switched bank account and have held the same account since I was student. Though I think the switching service is a step in the right direction, for me I think portability of your account number would also help.
Some banks are tempting to lure us in by offers or promotions. Earlier this week NatWest/RBS launched the new Cashback Plus scheme on a range of debit cards for both existing and new customers. And First Direct increased its joining incentive from £100 to £125 for new customers.
But cash incentives need to also come with good customer service and better products, to get us through the door. The banks should also help us by making it easier to compare the cost of running a current account so we can find the right account for our needs.
So are the banks doing enough to help you find the right account or is the seven-day switch unlikely to prompt you to move accounts?