Millions have people have switched bank account over the last decade using a service which is free, quick and, importantly, regulated and guaranteed.
Not only that, but those using the service to switch today can often find themselves earning a reward to do so - because competition between banks to secure your custom means they’ll pay out in cash for you to move.
The system is called the Current Account Switch Service (CASS) and it was set up by the government in 2013, to facilitate the ability to change banks seamlessly, as part of a wider reform of the banking sector.
Customers and businesses who change from one bank to another by using the service are fully protected against any monetary losses if something goes wrong, with the Current Account Switch Guarantee - part of the service - meaning you’ll be refunded if any costs are incurred.
There are several things to know about using CASS if you’re looking to switch banks, but the most important is simply that this is for current accounts only, not savings accounts, ISAs or other types of account.
Who is it for and which banks are involved?
Individuals can use the CASS, as can joint account holders - as long as both agree to it and the switch is to another joint account.
For businesses, it’s also available for use, though there are certain requirements regarding turnover and number of employees. The same applies for charities and trusts who wish to switch.
CASS have 51 banks or building societies currently listed as partaking in the scheme, including all the big British high street banks you’ll already know, digital online challenger banks and plenty more besides from the international scene. A full list can be found here; both the new bank you want to move to and your current bank need to be listed for you to use the service. CASS say their service covers 99 per cent of UK current accounts.
Why should I switch banks?
There are plenty of reasons you might want to switch banks, especially if you have been with yours a long time and don’t feel you are getting any benefit from them.
For example, moving to a new bank might mean you secure a better interest rate on a savings account which is only accessible if you have a current account with that bank, or perhaps a different bank has more branches open to you locally.
Customer service, perks or rewards and better apps or money management tools are also good reasons to consider whether you should stay with your present bank. And, of course, there’s the possibility to receive a cash offer for switching.
How long does it take to switch and how does it work?
The service is designed to complete a switch from old account to new within seven working days. You can either start the switch immediately, or nominate a day you want the switch to take place if it’s more than a week away. The service is always free to use - if a third party is charging you to switch your current account, you should seek advice.
To make a switch to a new bank, you simply have to decide which current account you want to open at a new bank, choose when you want the switch to happen and then tell your new bank you want to move using the Current Account Switch Service.
You’ll need to provide details of your old bank account, and make sure your personal details - such as address and so on - match exactly, but otherwise...that’s it.
Your new bank will handle all details of the actual transfer, with your money, your scheduled payments, your payee details and more all transfered across for you on the switch date, when your old account will also be automatically closed.
You can continue to use your old account, including app and card and so on, up to the switch date - but don’t set up new payment details (like direct debits) during the switch period as these won’t be changed across.
How can you earn money using CASS?
As for earning cash for using the switch service, you’ll need to look for banks who are currently offering a deal to move.
We keep an updated list here on Independent Money pages, showing each month the banks and building societies which have a current account cash switch offer.
These are constantly changing as banks battle for business and - beyond a cash reward which can be over £100 - it’s important to always look and see which perks and terms suit your needs. It might be that some give access to high interest regular saver accounts, have cashback offers or need a certain amount of money paid into the account within a month or two of opening.
It’s always important to check therefore that you meet conditions to receive a cash switch offer, which can be (but are not limited to) having a requisite amount of direct debits set up, not having been a customer of the bank previously or in some cases requiring you to pay a monthly fee for the account.
What if I’m overdrawn or someone sends money to my old account?
If you’re overdrawn, you may still be able to use the current account switch service, but you must check your new bank allows you to bring an overdraft across at all, or offers one which covers the amount you are overdrawn for.
As part of the switch guarantee, if anyone mistakenly pays money to your old account, it will always be forwarded to your new account - but do remember to inform those who pay you, such as where your salary comes from, that you’re changing accounts.
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