Move your bank account for free cash.
I’m a serial bank switcher, having completed nine separate switches since 2013 when it became a lot easier to go from one bank to another.
The banks have tried all sorts of different things to get you to change to them. From cashback on bills through to high interest on savings, there’s no reason for you to stick with a single bank if it’s not doing anything for you.
But the incentive that’s worked the best is the cash bonus. At one point or another in the last seven years, all the major banks have given away anything from £50 to £200 just by getting you to open an account with them – and importantly close your old account.
I’ve taken advantage of this, and by the start of 2020 I’d netted almost a grand in cash payments. Frankly, I’d run out of banks to switch to.
But then the pandemic hit and all the offers went overnight. Alongside changes to overdraft charges (where banks tend to make most of their money) and the tightening of terms on cashback and reward accounts, it looked like the switching bonus might be dead.
But things have suddenly picked up. We’ve seen five new bank switching bonuses over the last four weeks, with first Halifax and Metro, then RBS, then Lloyds and now HSBC all offering new cash incentives to get you to join them.
Yes, they’re all generally lower than previous rates offered, but it’s a sign that the banks are still desperate to get you as a customer.
And all of the recent switches have also been available to either existing or previous customers. That’s opened things up once more for me to get more free cash – and it could be the same for you too.
My £100 bonus from Halifax came into my account a week ago, and I’m about to apply to HSBC and Metro for another £175 – bringing my grand total to £1,230 over 11 switches. And that’s not including the extra I’ll have made from interest, freebies and reward payments!
You can either watch this video explaining more or keep reading.
(A quick aside here: It’s the better-off who will likely benefit from these incentives and that to fund them it’s the poorer customers in overdrafts who lose out. So it’s not exactly fair).
Before you switch
Bank switching basics
Bank switching isn’t something you should be scared of. All your payments in and out will be move over – including future ones. And there’s a guarantee which means you’ll get compensation if things go wrong. There’s more on how it works in my guide here.
Existing and previous customers
Though all accounts are open to new customers for each bank, some of the switching bonuses are also available to either existing or previous customers. You can even get a bonus for a second time, as I did with Halifax.
However there will be criteria here you need to check. For example, there could be a cut off date for when you closed the previous account or for when you previously received a bonus. So check the terms and conditions.
The impact on your credit report
Each application will also require a credit check. There’s no soft check here, though the chances of rejection are low for this type of thing.
However, multiple checks in a short period will hit your score. As will moving away from a bank you’ve been with for a long time – credit reference agencies like stability.
These aren’t much of a problem for most people – especially when you think people often change broadband and energy suppliers at the same time when they move house.
But if you are planning to apply for a loan, credit card, mortgage or other credit-dependent forms of borrowing then you might want to wait until that’s sorted.
How to get £375 in free cash
Though the Halifax promotion has already ended, there are still four to grab.
Technically it should be possible to keep switching the same account to get three of the bonuses, but you’ll need an extra account to switch to get all four. That’s because with two of the account there’s a lengthy wait period before the money is paid into your account.
In fact, if you don’t already have a spare account, I’d recommend opening one just for switching – you could quickly get a Monzo and / or Starling for this purpose.
Bear in mind too that though most of the offers have a while to run, they can end early or at any time – the Halifax £100 was closed a week early and the HSBC offer doesn’t have an end date.
Here’s what’s on offer right now, and the order I’d process them in. More details can be found in my bank offers guide.
HSBC – £125 (no end date)
I’m starting with this one as there’s no end date. That could mean it lasts ages, or it could go fast. It’s up to you if you want to chance it (it could of course come back if it does end!).
You’ll get the money within 30-days of completing the switch, which will take 7 days. So you’re looking at 37 days before you can start the next switch.
This account is only open to new HSBC Advance and Premium customers, though you can have had an account in the past. There are some restrictions if you currently have a First Direct or M&S Bank account.
Lloyds – £100 (Ends 9th November)
Both new and existing Lloyds customers can get the bonus for opening a Club Lloyds account, though there’s a cut off date of April 2018 if you’ve previously had a bonus.
The money is paid within 10 working days of starting the switch.
RBS – £100 (ends 19th November)
As with Lloyds, new and existing customers can get the bonus, though not if you’ve previously had a bonus from either RBS or Natwest since October 2017.
You’ll have to keep this account open until 29th January 2021.
Metro – £50 (ends 18th December)
This bonus is for new customers only.
This would be an alternative to RBS or at the same time if you have a second account to switch. The payment will be in your account no sooner than two months after switching, and probably a bit later.
Are there more to come?
I don’t have a crystal ball, but I think there will be more. Natwest usually does the same offer as RBS within a few weeks (they’re the same bank), and hopefully First Direct will reopen to new customers soon.
Previously M&S Bank always had a gift card promotion, while Nationwide had a refer-a-friend scheme so they also could bring these offers back.
Every time there’s a new promotion I list it in by constantly updated list of all the different offers and incentives you can get from banks – not just switching bonuses. So check that out for any updates!