Current account switching frequency

alex1793

Hi,

I've just switched current account from Nationwide to Halifax, purely for the introductory bribe. I'm tempted to switch again to another bank that offers another bribe. I've read a few articles that warn against frequent switching due to the negative effect this can make on my credit rating, so I'd just like more clarity on how often is too often?

ioscorpio

Since May I have opened 5 new current accounts and a Santander credit card and switched my main account and switched 2 of the donor accounts. I have received TCB cashback from Santander and just waiting to receive my incentives from Yorkshire Bank and TSB.

InsideInsurance

The key is you dont have to switch your main account, you can have an account intended purely for switching and retain your main account and thus retain the "ive been with my bank for 10 years" type answer that future lenders will like

Paul_1977

Why do banks allow it, why not just add a condition that "you must be switching from an account that you have held for at least twelve months."

InsideInsurance

Paul_1977 wrote: »

Why do banks allow it, why not just add a condition that "you must be switching from an account that you have held for at least twelve months."

As its a balancing act of stopping promotions being abused and putting barriers in the way of genuine customers. What are you suggesting is done to check the 12 month requirement? You have to get a letter from your current bank confirming how long you've been with them? Have to provide a year worth of statements for the account?

Paul_1977

Its simple, you give permission to your new bank to check with your old bank how long the account has be held.

Alternatively show your first statement. Or one which is at least twelve months old. These can be downloaded online these days.

Archi_Bald

Paul_1977 wrote: »

Why do banks allow it, why not just add a condition that "you must be switching from an account that you have held for at least twelve months."

Why 12 months? why not 3, 6, 9, 24? How much would it cost banks in admin costs to check? How much would it cost banks on the petty-ometer?

InsideInsurance

Paul_1977 wrote: »

Its simple, you give permission to your new bank to check with your old bank how long the account has be held.

You'd then also need to tell your old bank that you give them permission to divulge the details and hope that your new bank can get through quick enough and that your old banks customer service agent notes the third party data release authorisation etc

Its potentially workable but more things for you to do and plenty of opportunities for it to go wrong.

Paul_1977

I really have no idea how much it would cost the banks.

One would have to first see how many customers have switched to the bank and then closed/switched their account away within twelve months. It depends how long a customer stays with the bank for it to be worth it.

If a bank is paying £100, if a high amount of people are just switching for the dosh, it may be worth it to check, not petty.

masonic

Paul_1977 wrote: »

Alternatively show your first statement. Or one which is at least twelve months old. These can be downloaded online these days.

Paul_1977 wrote: »

I really have no idea how much it would cost the banks.

One would have to first see how many customers have switched to the bank and then closed/switched their account away within twelve months. It depends how long a customer stays with the bank for it to be worth it.

If a bank is paying £100, if a high amount of people are just switching for the dosh, it may be worth it to check, not petty.

But how would they check how much they have lost by turning away genuine customers who for whatever reason were unhappy with their current bank and wanted to leave within 12 months? How will they measure the reputational damage it will have caused them to turn away genuine customers?

It's worth remembering that the overriding reason for these incentives is that the banks in question are desperate to increase their customer base as quickly as possible. Nit-picking over a customer's banking history is not really in keeping with that desire. It's also worth remembering that this incentive would only be wasted on advertising if it wasn't paid out to customers.

anoncol

Surely really genuine switchers will have accounts for either years or for only weeks/months.You leave if you are unhappy with the bank which you find out quickly.