MOVE YOUR BANK ACCOUNT and make competition work

From 16 September it will be a lot easier and quicker to move your current account to another bank. Not quite as easy as changing your supermarket. But a lot easier than it has been.

Moving your bank account has always been a difficult and frightening experience. After all it is the place where your financial life happens. And the thought of something going wrong is worrying – and could be very expensive.

But if we don’t change our bank then competition doesn’t work. And they tend to rely on the fact that most of us stick with our bank for two or three decades. A quarter of over 65s are still with the bank they started with aged 24 or younger.

All that should change from with the new Current Account Switch Service.

In future it will take just seven days to move your current account from one bank to another – it takes up to four weeks now. All your standing orders and direct debits will be moved automatically. And so will all the payments in – your salary, your pension, and any other payments. All those payers will be told that your account has changed and sent the new details. In case they do not update their records at once the new service will automatically redirect payments sent to the old account and divert them to the new one. That will last for thirteen months.

The whole change process will be managed by the new bank you have chosen – you do not have to contact your old one at all. And if things go wrong and you do suffer penalties or bank charges the money will be reimbursed.

So now switching is easy, how do you know where to go?

The problems of switching are just one reason why we stick with the bank we know. It is also very difficult to compare banks or to see which one will be best. Only you can find your ideal bank. And the first thing to do is ask yourself how you use your bank now.

·         If you often have a large balance in your account then consider a bank which pays you interest – very few of them do now.

·         If you often go a bit overdrawn by accident choose a bank that gives you a decent buffer before it starts charging you.

·         If you run your life in the red then it is best to negotiate an overdraft facility with your bank. That is cheaper than going overdrawn without permission but can still prove costly. Find the cheapest and move to it.

·         If you want personal loans or a mortgage, some banks treat current account customers better than others.

·         If you want good customer service then some banks are renowned for poor service others for top rate customer relations.

·         If you need £100 then some banks will pay you just to switch.

 The important thing to remember is that when the new switching service begins on 16^th you can exercise your choice and move your current account much more easily. But it is still wise to check your new account frequently to make sure nothing is going wrong.

 Details of new service www.paymentscouncil.org.uk/switch_service

My blogpost http://paullewismoney.blogspot.co.uk/2013/09/swifter-switching.html

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