Bank switching rises by over 50%! New data reveals Brits are pouncing on bank switch deals

Twenty pound notes in back pocket of jeans

New data reveals that thousands of Brits moved their current accounts between July and September, with many taking action thanks to juicy bank switch incentives.

So which banks were the winners and losers? And are any switch offers still available? Here’s the lowdown.

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What did the data reveal about the number of bank switches?

The Current Account Switch Service (CASS) Q3 Dashboard reveals that Halifax was the biggest beneficiary of bank switches between July and September. The brand experienced a net gain of 16,684 customers over this period. 

Starling Bank wasn’t far behind, taking on 13,720 new customers. Meanwhile, Virgin Money gained a respectable 6,915 customers.

Monzo and Lloyds Bank also did well, with customer gains of 5,707 and 3,875 respectively.

In total, there were 212,600 bank switches during the third quarter of the year, almost 30,000 more than between April and June. Strikingly, the number of switches from July to September increased by 56% compared with the same period last year.

How have bank switch incentives impacted these numbers?

There’s no doubt that bank switch deals have been behind the strikingly high number of switches. Two of the biggest gainers, Halifax and Virgin, both launched attractive bank switch incentives earlier this year. 

In April, Halifax offered £100 to attract new customers, while Virgin launched a £150 gift card deal in June following the launch of its ‘M’ current account. While Halifax’s offering ended before the Q3 period, it is believed that individual bank data lags behind by a few months.

David Piper, Head of Service Lines at Pay.UK, which owns the Current Account Switch Service, echoed the belief that switching offers had played a large part in the high number of switchers.

He explained, “The number of Current Account Switch Service users rose in Q3 as consumers continued to explore digital options and switching offers. The return of competitive incentives being offered by participating banks and building societies is a strong sign of confidence returning to the market. This growth is encouraging, and as we look to the end of the year, our focus remains on ensuring our service is widely available to those looking to switch accounts in a simple, reliable and stress-free manner.”

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What else has impacted bank switch numbers?

Aside from bank switch bonuses, the CASS report highlights that common reasons cited by consumers for preferring their new current accounts included the quality of their bank’s mobile app and customer service.

Both Starling and Monzo traditionally score high on these points, which is likely the reason why these banking newcomers gained a high number of customers.

Which banks lost the most customers?

Santander, HSBC and TSB all experienced a huge loss of customers during Q3.

HSBC ended up with 16,564 fewer customers at the end of September, while Santander ended up with 11,176 fewer. TSB, another big loser, saw customer numbers drop by 9,491.

Interestingly, HSBC and Santander both launched hefty bank switch offers at the beginning of September to win back customers.

Meanwhile, sister banks RBS and NatWest, which also experienced a high number of deserters, have now also launched bank switch deals.

Which bank switch deals are still available?

It’s no secret that banks without a swanky app, or a high level of customer service, probably have to pay to attract switchers. With this in mind, there is currently a host of bank switch deals currently available. Here’s the lowdown:

  • Virgin Money – £150 gift card for switching to its ‘M’ account.
  • Santander –  £130 for switching to its Santander Everyday, 123 Lite or 123 accounts.
  • Nationwide – £100 (or £125 for existing customers) if switching to FlexPlus, FlexDirect or FlexAccount.
  • HSBC – £110 for switching to its Advance account.
  • NatWest / RBS – £100 if you switch, plus a further £50 in a year.
  • First Direct – £100 to switch to its 1st Account.

Ready to switch? With any of the switching offers above, pay close attention to the terms and conditions. Many offers will require you to move over direct debits and/or pay in a minimum amount. Others won’t let you switch from a bank within the same banking group.

For more help, see our article that explains how to switch your bank account.

The post Bank switching rises by over 50%! New data reveals Brits are pouncing on bank switch deals appeared first on The Motley Fool UK.

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