How to switch bank accounts

You can be hundreds of pounds better off by switching your current account.

I often write about the benefits of switching your current account – but I know from chatting with friends that lots of people don’t know how to go about it.

Luckily I’ve switched 21 times so I’ve got a good idea of what to expect. So here’s a simple explanation of what it is, and a step-by-step guide to doing it.

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Watch Andy’s video on how to switch your bank account

Why switch bank?

You can get all sorts of bonuses from moving your banking. I’ve done it mainly for free cash in my current account but I’ve also switched four times for fee-free banking in my business account.

You might also choose to switch so you can benefit from things like cheaper overdrafts, access to a local branch, cashback on bills or fee-free spending overseas. Or you might just be fed up with the service provided by your existing bank.

I’ve got a regularly updated guide to some of the best offers available from each bank, which is a good starting point. Though it’s important to remember you don’t necessarily have to switch. It might be better for you to open up additional accounts.

What is bank switching?

When you switch bank you’re essentially moving over all your money and payments (both in and out) from your existing current account over to a new account at a different bank. The bank will let everyone know the new details – from your employer (for salary) to gas company (for bills).

This is only for current accounts – you don’t switch savings accounts or ISAs – though it works for both personal and small business accounts. Joint accounts can only be switched with the permission of both account holders.

Types of bank switching

Most UK banks offer switching. There are two ways to switch – the full switch and the partial switch.

A full switch will move everything over and close your old account. You often need to run a full switch in order to get incentives such as free cash.

A partial switch lets you choose which payments and money to move over. It won’t close your old account unless you chose to. This is handy if you’re opening a cashback current account to earn money on your bills and there aren’t any additional switching benefits.

The switch guarantee

If you opt for the full switch with a participating bank (the vast majority of high street banks are signed up) then you’ll be protected by the Current Account Switching Guarantee. With this, all switches will happen in seven working days, though you can make it later.

The guarantee also means that you’ll be compensated if there are any problems that leave you out of pocket. 

The bank will also monitor payments into and out of your old account for 36 months after the last payment. So you could have a gap of 35 months with no money going in or out of your old account, but one payment in that 36th month will start another 36 months of monitoring.

What happens to your old account?

If you’ve gone for the full switch, your old account will be closed. That means you’ll not be able to use online banking, get old statements or use your debit card. You don’t need to do anything yourself – the new bank deals with it all for you. 

It makes sense to download any bank statements from your old account before you close it, and it’s a great opportunity to audit those direct debits and standing orders. This way you can make sure you don’t keep paying for services you don’t need or use.

You also need to watch out for any other products, such as savings accounts, credit cards and mortgages you hold with the old bank. Though in most cases it won’t be a problem, some are exclusive to current account holders. So if you switch away and close that account, it could mean you lose those other products, have to pay a fee, or get a worse rate.

What won’t switch

Only regular payments made with your account details will be switched and continue. Any payments set up with a debit card number, such as a regular payment for a subscription such as Netflix, won’t. So you’ll need to pay for those again with your new debit card details.

How to switch bank

The start of this process shouldn’t take you too long. Say 10 minutes of research and 10 minutes to apply. Well worth it when you consider how much better off you could be as a result.

Not every bank will have the application process, so just bear that in mind when you get to that stage.

Find your new account

Whether it’s to get free cash or just a better banking experience, check all the options available to you. Here’s my guide to switching incentives such as free cash, high interest and cashback on bills.

If you want the switching service protection, look for the Current Account Switch Guarantee logo. A full list of those participating can be found on the CASS website.

Make sure you meet the criteria

Alongside terms and conditions for the new current account you open (check these before applying), there could also be some eligibility criteria for the switching offer. These can vary by promotion, but these are the most common:

Some account switching promotions require you have a couple of active direct debits, which generally means they’ve paid out in the last year though might need to be in the last month. If these aren’t in place you might need to set new ones up. You might also not be eligible if you’ve previously held an account with the bank. 

Other accounts require a minimum payment into the account every month. This money doesn’t need to stay there, so you can transfer it into another account straight away if you want. You can also usually pay this money in stages. So say £1,500 is required, this could be three £500 payments in the month. It could even be the same £500!

Apply for the account

You’ll need to fill in the application form, which will likely ask for details about salary and expenses. You can do this online, over the phone or in a bank branch. Some of these are easier than others. 

You’ll need to provide proof of ID, and you’ll also be credit checked for most current accounts.

Choose the date you want to switch

You can choose a day to switch to happen. This is good if you say want to avoid it happening until after you’d been paid. The earliest this can be is seven working days from when your application is accepted.

Sometimes you can start the switch during the online application process. At other times you have to wait until you have been fully accepted, which might require you to go into a branch with identification documents.

Check you get the reward and everything has moved

I’ve switched many, many times but twice I’ve not had the bonus paid in and once one of my direct debits was cancelled rather than transferred. Both were easily resolved, but just keep an eye on your new account to make sure everything is as it should be.