MSE News: Current account switching hits new low

Former_MSE_Callum

The number of people switching their current account has dropped to a new low, according to figures released today....

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'Current account switching hits new low'

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mt99

Probably will hit a 'new high' now that the Yorkshire Bank £250 bonus has gone nationwide.

Caddyman

Well, switching is easy enough, I've done it twice myself, both of which were completely hassle free and concluded within 7 working days. My last switch was back in June this year to TSB who gave me £130 for free and pay me £10 a month extra for having two direct debits and for using my contactless card 20 times a month. Once that incentive concludes, I'll just find another bank to switch to.

The problem is, some accounts require a high pay in or have lots of other conditions attached and so some people who want to switch for the 'bonus' won't get it if they can't meet the minimum pay in requirement or can't comply with the terms and conditions of the account.

It could also be that lots of people aren't passing bank credit checks, so may well be refused a switch anyway, which of course will lead to a downturn in switchers.

Most likely the reason is, people just can't be bothered and consider it far too much hassle, which is really rather ridiculous when you consider that the bank does all of the hard work for you! Sticking with the same bank, the same utility company etc, is just 'normal' for lots of people, irrespective of the fact they might actually be able to save money. That's up to them at the end of the day, but for me, I'm happy to switch every 12 or 18 months if the incentive is right for me. As I do all of my own banking online anyway, switching is just becoming a normal part of my financial way of life.

SuiDreams

I have either already previously completed switches to those currently offering incentives or am excluded for already having accounts. Unless new incentives come along there is no reason for me to switch again. There will always been high points and low points in switching depending on what incentives there are around. Plus you don't necessarily need to switch to get a better deal as you can have multiple current accounts to take advantage of multiple offers at the same time.

Lokolo

Not only what SuiDreams has stated but some people don't really want or care about switching.

Yes £100/£200/£250 is great and all but tbh I've been with certain bank for over 15 years and another for over 10 and I won't move just for the sake of a couple of hundred quid. I'm happy with the service and my account.

Consumerist

I think the simple truth is that too many people just don't understand finance and don't believe the promises of being better off if they switch.

You only have to look at the dogs dinner served up by Ofgem when switching energy suppliers, on the promise from comparison sites of "savings", to understand why the uninformed are reluctant to change.

Busy people these days seldom have the time to go through terms and conditions with a fine-toothed comb - a necessity forced on us by booby traps which the banks rely on to justify their actions.

For the most part, I think switching banks is likely to remain a pastime for the financially savvy for whom the novelty is beginning to wear off. Only time will tell but the FCA will, no doubt, continue to be King Canute until it drowns in its own failure as seems to be the case for Ofgem.

worried_jim

Open banking next year may encourage more to switch.

eskbanker

worried_jim wrote: »

Open banking next year may encourage more to switch.

Time will tell of course, but I'd have thought it could actually go the other way, as one of the main changes is to allow third-party access to accounts, so customers who dislike their bank's online banking facilities or apps (sometimes cited as a reason to switch) will be able to use a different interface without changing banks.

Caddyman

Lokolo wrote: »

Not only what SuiDreams has stated but some people don't really want or care about switching.

Yes £100/£200/£250 is great and all but tbh I've been with certain bank for over 15 years and another for over 10 and I won't move just for the sake of a couple of hundred quid. I'm happy with the service and my account.

Yup, that's about the crux of it, many people just cannot be bothered or just don't care.

As far as I'm concerned, switching current accounts in todays climate of non existent interest rates, is money for old rope. £130 in my own case a few months back for doing practically nothing? 10 minutes application and let the bank do the work? Earn more money in one hit than you'll get in an entire year in interest on some rubbish interest savings account, in my case, £180 over the year.

Off topic concerning banking, but back in May, I switched via Topcashback to BT from Plusnet and got £280 back, a £200 BT Reward card and £80 from Topcashback. I also switched car insurance company and got another £52 back, so a total of £512 (that's including the £180 over the course of the year from my TSB bank switch) in my pocket for extremely limited effort! Now that is being financially savvy.

I couldn't care less about giving loyalty to any particular bank whether they offer great service or not. Ok, if you are happy sticking with a bank you've been with for 15 or 20 years, good on you, but remember, they probably don't care about you as an individual, unless you're depositing insane amounts of money with them.

JuicyJesus

Most people just genuinely can't be arsed with it, but it amazes me how the regulator can't get this.

They start a wheeze to get people to switch banks, at huge cost, on the basis that not enough people are switching. Then a few years later, not enough people are switching, so they start another hugely expensive wheeze. Rinse and repeat again.

The regulator can't seem to grasp that most people don't give a sh*t about who provides their bank account.

Consumerist

Caddyman wrote: »

. . . I couldn't care less about giving loyalty to any particular bank whether they offer great service or not. Ok, if you are happy sticking with a bank you've been with for 15 or 20 years, good on you, but remember, they probably don't care about you as an individual, unless you're depositing insane amounts of money with them.

I don't know where this concept of loyalty comes into banking. In my view, substituting the word "laziness" for the word "loyalty" would be nearer the truth in the switching parlance - be it energy, banking or anything else.