MSE News: Current account switch decline – which banks were the winners and losers?

Former_MSE_Megan_F

More than 900,000 current accounts were switched in the last 12 months – a drop of 15% compared with the previous year...

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'Current account switch decline – which banks were the winners and losers?'

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Mchambers

No surprise that Barclays were bottom.

I used to work there for a few years and am glad that I left. Taken early retirement.

I still have an open account with the Go-To bank but only have a few pounds in it. Just use this each year to renew Kapersky Internet security, which you can get for free if you bank with them.

veryintrigued

I make that a net loss of 3327 accounts.

Have I missed something?

EachPenny

veryintrigued wrote: »

I make that a net loss of 3327 accounts.

Have I missed something?

The statistics don't mean anything in the real-world. It is no surprise that the banks near the top of the list offer the best incentives to switch - Nationwide bunging £200 in the direction of people who arrange with a "friend" to switch to them almost guarantees them the top slot.

What I think might be missing from the data is the number of accounts which are closed with no switch taking place - e.g. the "friends" switching to Nationwide who simply close the account as soon as the minimum period after the money has been paid has expired.

It would be far more informative to see a table of the total number of current accounts each bank is providing, along with the percentage change in the quarter. My guess would be Barclays (and others) are not doing so badly - which may explain why they don't feel the need to join the 'free cash' rush.

Edit: And the 'decline' in switching probably has more to do with serial-switchers running out of options, and a reduction in the incentives paid to switchers.

eskbanker

veryintrigued wrote: »

I make that a net loss of 3327 accounts.

Have I missed something?

According to the original published data

Data from Handelsbanken and Metro Bank has not been provided for Q4 2016

so these two may have gained the missing accounts (which I make 2,581 btw).

System

eskbanker wrote: »

According to the original published data
so these two may have gained the missing accounts (which I make 2,581 btw).

I can't speak for the Swedish bank but when I opened a Metrobank account in Q4 2016, the other two people (in branch) were opening accounts to switch from Barclays and NatWest - which would fit in with your thinking.

Bank's don't want rate tarts or cashback chasers. They want lazy people that buy as many of their products as possible.

batrachophagus

EachPenny wrote: »

The statistics don't mean anything in the real-world. It is no surprise that the banks near the top of the list offer the best incentives to switch - Nationwide bunging £200 in the direction of people who arrange with a "friend" to switch to them almost guarantees them the top slot.

What I think might be missing from the data is the number of accounts which are closed with no switch taking place - e.g. the "friends" switching to Nationwide who simply close the account as soon as the minimum period after the money has been paid has expired.

It would be far more informative to see a table of the total number of current accounts each bank is providing, along with the percentage change in the quarter. My guess would be Barclays (and others) are not doing so badly - which may explain why they don't feel the need to join the 'free cash' rush.

Edit: And the 'decline' in switching probably has more to do with serial-switchers running out of options, and a reduction in the incentives paid to switchers.

Agree with most of your comment.


You can find banking asset and liability in annual reports, but doubtful anyone would show volume of accounts. And of course not all accounts are profitable.


It is probably worth the providers with the best service paying customers to trial their accounts (e.g. Nationwide and First Direct). It isn't going to overcome the fact that most people are completely disinterested in switching their account, and would only consider it for £500+ or if they experience a problem with their current provider.


I would guess switch-tarts are a small proportion, but it would only be a guess.

eskbanker

batrachophagus wrote: »

I would guess switch-tarts are a small proportion, but it would only be a guess.

I'm not sure if I'm missing your meaning (i.e. a small proportion of what exactly?) but if you're referring to switches as a proportion of all accounts then there's no need to guess, in that the article specifically and prominently states that:

there were 909,186 switches between 1 July 2016 and 30 June 2017, equating to just over 1% of the 70 million active current accounts in the UK

colsten

Current account switching incentives disappear.

Number of current account switches decline.

Bears sh*t in the woods.

EachPenny

colsten wrote: »

Current account switching incentives disappear.

Number of current account switches decline.

Bears sh*t in the woods.

Completely agree.

The number of accounts 'gained' in the switching tables would be the 'vanity' part of a modified version of the the well known vanity/sanity business saying. It is easy to gain new customers (/increase turnover) if you are willing to give enough cash away to achieve it.

Nationwide has the luxury of no shareholders to scream and shout at them for giving their profit away so easily.

Terry98

Why are First Direct not showing in the list?

I thought they might be included with HSBC but Nat West and RBS are both shown.