MSE News: Osborne commits to speedier bank account switching 4 February 2013 at 2:35PM in Budgeting & Bank Accounts 74 replies 4.5K views

Former_MSE_Jamie

"Banks will have to move all your direct debits and standing orders within a week from September ..."

Read the full story:

Osborne commits to speedier bank account switching



Click reply below to discuss. If you haven’t already, join the forum to reply. If you aren’t sure how it all works, read our New to Forum? Intro Guide.

pmduk

Osborne's always commiting other people to do things quicker than he ever achieves himself

Willing2Learn

I'd never trust a bank to do the switch for me. I'll always do it manually until we have statutory rights within a regulatory framework that guarantee all losses to the customer would be fully refunded by the bank, including any fees from the recipient for having not received their payment.

Consumerist

"However, I still think until we have portable bank account numbers, like mobile numbers, customers will be put off, as the important thing is giving consumers confidence in the switching process.
"The ability to shift account so nothing else changes other than the service is the holy grail. I hope not to be proved right that this is an open goal missed."

Sorry Martin but I couldn't disagree more.

This could lead to such confusion when trying to sort out banking problems.

In my view, the last thing we would want is transferable account details when being hounded by debt collectors.

JuicyJesus

Consumerist wrote: »

This could lead to such confusion when trying to sort out banking problems.

It's just a solution in search of a problem. Portable account numbers would only help with regular credits coming in, which most people have one or two of and which are trivial to switch if you choose to change banks. The real problem is switching of debits, of which most people have about 10 or more of - and this problem has pretty much been solved.

There are a few other cases where portable account numbers would be useful, but they are edge cases, and not worth completely upending our account numbering system for. Especially not when the cheque clearing system would completely break down if a specific sort code didn't refer to a specific branch or bank.

Mainly people propose it because of that old chestnut of "we aren't getting the results we want" -> "we must do something" -> "portable account numbers are something". People aren't switching accounts not because it's a pain in the a*se, but because it's a pain in the a*se for very little real benefit, as personal current accounts are all pretty much the same price and the only real differentiation is service, which you won't know about until after you've switched anyway.

JuicyJesus

Also, and because I forgot to mention it in my post above, and it bears repeating: George Osborne is a numpty.

WestonDave

Portable bank numbers would require the whole banking system to be reinvented, not just in this country but internationally - it simply isn't going to happen.

Your account number itself is probably duplicated a number of times within other banks - what makes it unique to you is the combination of that 8 digit number (unless you have an old Lloyds 7 digit one!) and the sort code which identifies the bank and branch controlling the account. So my 40-07-18 12345678 can be separated from someoone elses 20-25-90 12345678. Making my number portable under the current system backfires either way of doing it - if I move just my account number to the other bank the numbers clash (especially if you move to a bank like First Direct which has relatively few sort codes) and if I move both we end up losing the sort code system which tells people working in the system where to contact if there is a problem. (It also works internationally as the two are combined to produce IBAN numbers etc). If you start shuffling it so old HSBC codes are moved to Lloyds etc, that whole end of the system starts to fall apart - in theory that can be overcome by having a new central database to relate them back to their holding banks but its infrastructure to fix something which largely isn't broken.

I say isn't broken because if you choose a decent bank in the first place like First Direct, moving accounts isn't a problem - you just don't need to!

innovate

Not that I want to defend banks, but how can they be made responsible for switching direct debits within 7 days?

Direct debits are authorisations given by account holders to companies such as utilities and insurance firms. Should be interesting to see how banks will convince all those companies, as well as local councils, that they now have to dance to the tune of banks.

Good luck to them, and good luck to the folks who need a switcher service.

Consumerist

innovate wrote: »

Not that I want to defend banks, but how can they be made responsible for switching direct debits within 7 days?

On that basis, why should banks be responsible for anything they do - or don't do?

innovate

Consumerist wrote: »

On that basis, why should banks be responsible for anything they do - or don't do?

Of course banks should be responsible for what they do.

But can you explain how they can be held responsible for what your local council, your credit card company, your electricity supplier etc etc do?

This Gordon Osborne idea is a bit like you being held responsible if the bus in your street is late. You would think that is ridiculous, because it is. To tell company A they will be responsible for something company B must do is equally ridiculous.

Consumerist

My understanding of the proposed arrangements is that following an account transfer, the losing bank will, for a period, forward any calls on transferred DDs to the new bank for execution.

I don't see any problem with such an arrangement.

It should mean that customers are no longer faced with the current situation of having to fund two accounts at the same time because DD recipients take differing times to update their account data.