How to switch your current account

It covers 99% of current accounts in the UK, meaning the majority of people can use it to switch from one bank to another.

There should be no disruption to outgoing or incoming payments and, if there is, the costs will be covered.

To date, more than 8 million people have used the Current Account Switch Service to move their current account.

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What is the Current Account Switch Service?

The Current Account Switch Service (CASS) is a seven-working-day procedure that switches your current account from one bank to another.

It's all done automatically; once you've successfully applied for an account with a new bank, your old bank has to pass everything along without argument.

Supported by nearly all of the UK's banking brands and financial providers, the service promises to make the switching procedure quick, straightforward and stress-free for everyone - not just a select few.

With most of the work involved handed over to the banks, customers are now largely able to forget about the switch until the final handover date, when they can simply start using a new set of cards.

Switch Guarantee

CASS comes with a Switch Guarantee for those who want to switch current accounts and fully close their existing current account in the process.

Under the Current Account Switch Guarantee:

• The switching service is free to use
• The customer can choose the switch date with a minimum of seven-working days
• All money within the account will be transferred to the new one on the switch date
• All Direct Debits, standing orders and incoming payments will be automatically moved to the new account
• If anything goes wrong with the switch and the customer is wrongly charged or hit with interest/fees, CASS will refund the money

The Guarantee also confirms that the service will let customers know if there are any issues with the switch prior to the switch date.

With the Guarantee, customers can feel confident that, even if something does go wrong, they will not be financially liable for any errors.

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How to switch bank accounts

The Current Account Switch Service is designed to be a quick and uncomplicated process.

While the idea of switching a bank account and rearranging all the payments in/out that we make each month can be intimidating, there is a step-by-step process that is easy to follow.

1. Make sure you can switch

The Current Account Switch Service covers 99% of current accounts in the UK, but there are a few types of bank account you can't move with this service:

• Joint accounts - if you don't have the permission of both the account holders
• Saving accounts
• ISAs
• Accounts in non-sterling (£/GBP) currencies

Given that the purpose of CASS is to allow people to easily switch their current accounts, these limitations are understandable.

2. Find a new current account

We look more closely at the reasons why people might want to switch to a new current account below but the first port of call is our free bank account comparison tool.

Choose the type of feature that is most important to narrow down the results:

• Interest paying
• Mobile only bank
• Insurance cover
• Overdraft facility
• Cashback / reward
• Basic account

After finding a current account that's the right fit, the applicant must check that they're eligible for it.

Different accounts have different requirements. Some might stipulate that customers need to have a certain amount of money coming in per month, or a minimum number of direct debits going out.

3. Prepare to switch

There are a couple of things to do before starting the process of changing bank accounts. These aren't compulsory but they will make life easier later.

1. Review regular payments. Check existing outgoings to see if there's any are inactive or are unwanted. This is a good time to cancel those payments.
2. Gather documentation. While the payments themselves will be transferred during the switch process, a customer's transaction history won't be. For the purposes of tax or financial tracking, grab those before the switch takes place.

Again, these aren't compulsory, but it's worthwhile going through the steps to ensure you've got everything you need for later.

4. Choose a date to switch

The customer gets to pick when they want to switch. The 'switch date' can be any working day (so no weekends or bank holidays).

Remember that it takes seven working days to switch and allow for that timeframe.

The old account will still be usable during those days, but it's not a good idea to set up new direct debits or standing orders on the old account (they won't be transferred).

5. Start the switch

Ask the new bank to move your old account using the Current Account Switch Service.

This step will vary from bank to bank, but most financial institutions make it very easy. They want people to switch to them. Customers can usually choose to switch in-branch, online or through their mobile bank.

There will be forms to fill in, but current accounts are usually pretty easy to open.

The customer will need to agree to the "Current Account Switch Service Agreement" and the "Current Account Closure Instruction", which will be presented by the new bank.

6. Wait for the switch to happen

The new bank or building society handles the rest. They should let the customer know when everything's finished - or if there are any delays.

If everything goes smoothly (it almost always does), the new account will be ready to use as usual on the agreed switch date.

Remember the Switch Guarantee: if anything does go wrong, seek a refund for any fees or interest accrued.

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Why to switch bank accounts

Switching a bank account doesn't necessarily come with the money savings we see from switching our broadband, but there are some good reasons to change who we bank with.

One of the biggest factors may be the choice between local banking and mobile banking:

• If we want a local bank branch, we may move away from a bank that is closing our local branch
• If we prefer mobile banking, we might switch to a mobile only challenger bank

Other reasons to consider switching include:

• Better interest rates
• Cashback
• Better overdraft rates
• Lower penalties for missed payments
• Deals on insurance and loans
• Saving spaces within apps
• Access to in-app credit scores
• Blocks on gambling
• Features for vulnerable customers or mental health support

Customers may also look at the customer service records of specific banks or the ethics of those institutions, so let's look a little more closely at those two points.

Banking customer service

The level of customer satisfaction varies from bank to bank - and there are some significant differences to be aware of.

Independent data published by IPSOS Mori on personal current accounts in February 2022 found customers would recommend the following banks to family and friends based on overall service quality:

The top three here are all digital-only banks, although first direct is part of HSBC rather than being an independent challenger.

We have to go to number six in the list to find one of the biggest names in UK banking (Barclays with 63%) while major rivals like NatWest and HSBC are further down the table at 10 and 12 respectively.

On this metric alone, we can see some significant differences between customer satisfaction levels.

Read more about the best customer service in UK banking.

Ethical banking

Customers may also choose to switch to another bank because of their ethical stance or, perhaps more likely, switch away from one bank because of ethical concerns such as:

• Environmental policies
• Types of company they fund
• Community involvement
• Charitable donations
• Equality and diversity considerations

We look at ethical banking in more detail in our dedicated guide.

Switching incentives

Incentives to switch bank accounts are much rarer than they used to be.

A few years ago, it wasn't uncommon to find deals offering cash to switch, but this isn't a strategy used by many banks to entice customers anymore.

There may be some deals available, but it's unlikely these will be the prime reasons for switching bank accounts.

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Barriers to moving bank accounts

Despite the success of the Current Account Switch Service and the improved awareness around it, there are still some barriers that may put people off switching their bank account.

Confusion

Some customers are simply too confused by all the various features offered across the huge number of current accounts available today to know where to start when thinking about switching.

This can be especially difficult when comparing accounts that charge monthly fees and assessing the benefits they will actually have on a person's financial life.

For example, some accounts offer perks such as extra interest or cash back on card transactions and direct debit payments while others include mobile or travel insurance.

Beyond the gimmicks, the products on offer are often almost impossible to meaningfully compare with each other - so it's unsurprising that so many people stick with the same account year after year.

Financial exclusion

Plenty of the most rewarding - and therefore most publicised - current accounts come with strict conditions. The most obvious is being able to deposit a guaranteed amount every month, with the amount in question ranging widely.

There are ways to get around the minimum deposit requirement - like setting up standing orders to move money around various accounts so that the minimum deposit is reached using the same money a few times over - but it's an instant disqualifier for many people.

Others are put off moving because they aren't guaranteed to get an authorised overdraft to the extent they need before they start the switching process.

Then there's the issue of access. Particularly among the challenger banks, more accounts can only be opened and run online or over the phone - and while that may be fine for those attached to their smartphones, there's a significant part of the population who need or want easy access to a local branch.

That said, with bank branches closing and the face of banking on the high street shifting, it can be more difficult for people to keep hold of their bank accounts with a local branch.

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Why was the Current Account Switch Service launched?

Before the launch of the Current Account Switch Service, changing current accounts could be a complicated, time consuming, and potentially costly process.

But that wasn't the only reason for the change.

The report that spurred the switch

In September 2011, the Independent Commission on Banking (ICB) published the Vickers Report, which looked at the state of UK banks and financial providers.

It was a direct response to the UK-specific financial crisis of 2007, which saw the demise of Northern Rock, and the international financial crises of 2008-2009.

The report made major recommendations which the Government pledged to adopt. One of these was the introduction of a free current account switching service. The report said that such a service would have "significant net benefits" for both customers and the economy.

As far as customers are concerned, those "net benefits" include:

• Simplifying the process for switching current accounts
• Improving customer service levels
• Allowing smaller financial institutions to compete with the UKs "Big Four" banks

The system has had time to settle in and more people are using the service to switch, although there are still plenty of people who haven't switched their bank accounts for whatever reason.

How the new system compares to the old

The old process of switching accounts was a lengthy and hazardous procedure. Successful switches often owed more to luck than design.

Under the old switching service:

• Customers could expect to wait anything from 18 to 30 working days for a switch to be completed
• Customers were often expected to contact all payment providers to inform them of new account details
• Direct debits and standing orders would transfer piecemeal over an indeterminate length of time
• Charges and interest could be incurred if the old account failed to close properly
• Payments received into the old account after closure would be directed into a holding account and sit there until the customer realised it was missing

Understandably, people were deterred from switching accounts because of the sheer hassle involved.

It took a long time, it was inconvenient, it sometimes cost them money as a result of charges and interest and, in extreme cases (such as a payment being missed), it could have an adverse effect on a customer's credit rating.

As we can see from the table, the speed and ease of switching has dramatically improved thanks to the CASS.

The situation was further improved in 2017 when Bacs made further changes to the way the service worked.

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How many people switch bank accounts?

Figures from Pay.UK published in April 2022 show that more than 8 million successful switches have taken place since the Current Account Switch Service launched in 2013.

841,211 switches took place in the year to the end of March 2022, almost 50% more than the previous year.

Between January and March 2022, 196,964 switches took place across 47 banks and building societies.

Data from the previous quarter shows which banks are benefiting most with net customer gains:

1. Santander
2. Nationwide
3. Starling Bank
4. Monzo
5. Triodos Bank

While Santander and Nationwide are big names, Starling and Monzo are mobile only challenger banks who continue to attract customers via the switching service.

We've seen a gradual yet steady decline of customers staying with the four major banking entities (Lloyds Banking Group, Barclays, HSBC and NatWest Group.

Those four groups had 68% of the market in 2018 down to 64% in 2021 according to Financial Conduct Authority (FCA) analysis while digital challengers rose from 1% to 8% of the market in the same time frame.

Mid-tier banks like Co-Op and Metro Bank remained static with a 4% market share while scale challengers (Nationwide, Santander and others) fell slightly from 26% to 24%.

Satisfaction with switching

Pay.UK data also shows how satisfied customers are with the Current Account Switch Service and how many switches are meeting the promised seven-day switch target.

Q1 2022 data demonstrated that:

• 90% of customers who had used the service in the last three years were satisfied with the overall process (down slightly from 93% in Q1 2021)
• 99.8% of switches were completed within seven working days (same year-on-year)

So, CASS is keeping to their promise of seven-day switching, with just a fraction of switches not completed within that time.

However, customer satisfaction with the switching service itself has declined slightly. This is something to keep an eye on in future years.

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Summary: Consider a switch

Thanks to the Current Account Switch Service, it's much easier to transfer a bank account from one bank to another with a minimum of fuss.

The success rate in switching within the seven-day period is almost perfect and there is high customer satisfaction with the process.

However, while it is positive that 8 million people have used the service to switch since 2013, there are still millions more who could benefit from shopping around for a new bank account.

Here are some situations where you might consider a switch:

• To find a bank with better customer service
• To find a bank with local branches
• To get rewards or extras
• To ensure money is spread between different banking groups

The differences between banks can seem slight but they are there and, in particular, if you've had a negative experience with one bank, it could be time for a switch to start afresh.