MSE News: Banks must do more to ensure current account users get the best deal

Cisco001

michaels wrote: »

What annoys me is that there is a cost to switching, credit scoring is often gives weight to how long you have been 'with your bank' which this study and indeed most of the guides like Martin's ignore. For businesses it is an even bigger issue. Of course this could be overcoem if your accoutn history came with you to the new bank but no one seems to have even thought about it.

I don't know what other people doing. But I keep my main bank account for the history.
Then open 2nd & 3rd account for switching incentive...

SnowTiger

Malcnascar wrote: »

Day to day, I need a debit card, direct debits and standing orders, to pay irregular bills and access to my account on line and on mobile all of which my Bank do very well. I don't use the Branch network, the call centre is open much longer. Not too sure where my £70 per annum saving is, but hope the result of all this switching, that I'm not doing, will not result in charges for basis banking transactions like they do in Spain on my account there.

I think people who compile these reports, and those who report on them, assume the average bank customer regularly dips in to an overdraft and skips a few payments every year, thus incurring charges.

GingerFurball_2

As "free" banking is a misleading term, let's call it "no-charge" banking. Surely that's as the result of competition?

I reckon more people would make use of CASS if there was an option for them to retain their old accounts. As we've seen when banks (usually RBS Group) suffer an IT meldown,having an account with a different provider can be quite handy in terms of retaining access to money.

The people really let down by a lack of competition are people who use overdrafts a lot; but they suffer from the credit paradox where the more affluent you are the more and cheaper credit you have access to. Forcing banks to match current overdrafts when switching will just lead to more applications being declined.

Kim_13

I think account switching is more than sufficiently publicised as it is. It's in every branch window. Halifax's recent incentive was all over the TV. TSB's 555 offer is all over the TV. Surely any more promotion that is required would be at the cost of switching incentives?

As with credit card fees, it seems like an unnecessary measure that will only hurt the financially prudent.

dggar

GingerFurball wrote: »

.......
I reckon more people would make use of CASS if there was an option for them to retain their old accounts........

If this option was there you wouldn't be switching;
you would be opening another account with another provider.

grumbler

dggar wrote: »

If this option was there you wouldn't be switching;
you would be opening another account with another provider.

Does it matter how it's called? The same service could have an option for, say, "moving" that moves all your regular payments, but doesn't close the old account.

colsten

GingerFurball wrote: »

I reckon more people would make use of CASS if there was an option for them to retain their old accounts.

I am intrigued why you think that (and why the CMA might be asking for it, too). What would be the benefit of it?

I reckon it would just create more confusion. If you keep your old account open, do you want all the incoming payments redirected, or just some, or none? Similar for the DDs and SOs. Also, banks are unlikely to pay any switch bonus if people don't switch, so I can already hear the "unfair, they didn't pay me the switch bonus" cries.

It's not as if it isn't totally straight forward to open a second (third, fourth....) current account, and if needed, ask your employer to pay money into that account, and/or change your DDs and SOs. It's been possible for years, and it's been done by people for years.

There are so many reports from people who are confused and struggling even with the existing, simple, CASS. How would they cope with a more flexible approach?

jimjames

grumbler wrote: »

Does it matter how it's called? The same service could have an option for, say, "moving" that moves all your regular payments, but doesn't close the old account.

Problem is that keeping the old account open will then cause issues with redirection. The huge benefit of the CASS system is that everything is seamless. When I've moved accounts without it then it's just caused chaos.