Current account switches hit a record
Generous cash incentives helped to drive a switching surge between October and December 2022.
More than 376,000 current account switches took place in the last quarter of 2022, new figures reveal.
The data, from the Current Account Switch Service (CASS), is the highest quarterly figure on record for UK current account switches and shows an increase of more than 222,000 vs the previous quarter in 2022.
The new figures also cover the account providers that ended the third quarter having gained the most customers: Santander was the winner. The bank was helped by its switching incentive, which is currently £200.
The CASS is an independent, free-to-use service which helps UK current account holders switch their account.
What is driving current account switches?
At the end of last year, several banks and building societies offered cash incentives for customers to switch their main current account.
Providers such as Nationwide and HSBC offered as much as £200 to entice customers to make the move, which typically entails paying in a certain amount each month, and moving several direct debits to the new account.
Banking providers also started to raise interest rates on regular savers linked to their current accounts, to attract more customers. first direct’s Regular Saver interest rate jumped to 7% on 1 December, while HSBC’s linked savings account saw a rate boost to 5%.
These incentives, combined with the cost of living crisis and people wanting more from their banking providers, meant a lot of Brits decided to switch.
Which banks are people switching to?
Today CASS published the total switches for last quarter of 2022 plus the numbers for each provider for third quarter: July to September 2022.
Here are the banks with the highest net switching gains in July to September, 2022:
Santander had a £175 switching bonus available during that period, while Nationwide was offering new customers £100 to switch.
Digital banks such as Monzo and Starling Bank proved particularly popular with switchers; features like budgeting tools and virtual savings pots encouraged customers to join these challenger banks.
As consumers continue to feel the squeeze on their finances, we’re likely to see many more being tempted by cash incentives or looking to use budgeting features in their banking app.
For the latest switching deals, see our best bank switching deals guide.
