The banks we're all switching to
New figures show 1.2 million current accounts were switched in the first full year of the seven-day switch guarantee from October 2013 to the end of September 2014, according to the latest figures from the Payments Council.
But which banks have been the big winners – and which are struggling to keep up?
[The bank that beats John Lewis for customer service]
Who we are switching to
The Payments Council has also published figures for the first quarter of this year, showing the switching numbers for the major banks and building societies.
Bank | People switching to the bank | People switching from the bank | Net change |
Halifax | 65,636 | 24,078 | 41,558 |
Santander | 60,882 | 23,566 | 37,316 |
Nationwide | 22,771 | 11,091 | 11,680 |
Bank of Scotland | 3,394 | 3,497 | -85 |
Danske Bank | 520 | 885 | -365 |
Bank of Ireland | 273 | 801 | -528 |
AIB Group (Allied Irish Bank/First Trust Bank) | 144 | 979 | -835 |
Ulster Bank | 207 | 1,742 | -1,535 |
Clydesdale Bank (includes Yorkshire Bank) | 1,264 | 8,135 | -6,871 |
Co-operative Bank (includes smile) | 4,463 | 12,315 | -7,852 |
Royal Bank of Scotland | 2,335 | 12,236 | -9,971 |
Lloyds Bank (includes TSB prior to divestment of TSB from Lloyds Bank) | 60,877 | 76,079 | -15,202 |
HSBC (includes First Direct and M&S Bank) | 16,988 | 32,417 | -15,429 |
Barclays | 10,497 | 27,414 | -16,467 |
NatWest | 11,482 | 29,740 | -18,258 |
Source: Payments Council
Handelsbanken and Metro Bank didn't supply figures.
Winners
Halifax and Santander are the big winners in the battle for current account customers with the highest overall net gains, with Nationwide the only other company to see gains.
It's no surprise to see those three making gains as all offer decent incentives for current account customers.
Halifax offers £100 for switching to any of its three current accounts but if you go for the Reward option you'll get £5 each month as long as you pay in £750, pay out two different direct debits and stay in credit. You also earn cashback on certain offers when you spend using your debit card.
Santander's number of switches is no doubt down to its 123 Current Account. It’s an attractive option that not only pays up to 3% interest on balances of up to £20,000, but also offers cashback on certain direct debits.
You get 1% cashback on water, Council Tax and Santander mortgage payments, 2% on gas and electricity bills and 3% on communications bills. However, there is a £2 monthly fee to take into account.
Meanwhile, Nationwide’s FlexDirect account pays a mighty 5% on balances of up to £2,500 for a year, so long as you pay in £1,000 a month. It also offers a fee-free overdraft for that first 12 months and there’s no monthly fee to worry about.
It will be interesting see how TSB and Tesco Bank fare in forthcoming results.
TSB 's Classic Plus account also pays a whopping 5%. Although it only applies on balances up to £2,000, the rate doesn’t drop away after a year.
And Tesco now offers a current account paying 3% interest and rewards customers with Clubcard points on debit card spending.
[Up to £1 million of savings to be protected]
Losers
The biggest losers were NatWest, Barclays and HSBC. All of them, certainly at the time of the switching figures, were not offering compelling accounts and all three regularly score below market average for customer satisfaction.
Time to switch?
While 1.2 million main current accounts were moved in the past 12 months, that's only a 22% increase on the previous year. If you're fed up with poor customer service and/or you want a better deal, the Current Account Switch Guarantee means there's never been a better time to move your money.