New account switching service proves hit as 35,000 Brits initiate move

Source: Payments Council

Just over a week after the launch of the new Current Account Switch Service, the Payments Council today (26th September) confirmed that the central IT system on which the service is built is operating smoothly, with initial figures showing that more than 35,000 people have started to switch their account since launch.

Price comparison sites have also reported a surge in customer traffic to their switching sites, as customers do their homework and check which accounts are most suited to their needs before deciding to switch.

Adrian Kamellard, CEO of the Payments Council said: "Although it is too early to tell what switching levels will be over the longer term, interest in the new service has clearly got off to a great start. For us, getting the system successfully launched is only the first step - the next is to learn from what customers actually experience and if necessary to make any improvements. Everyone across the industry is determined to put in the work to get the switching experience as good as it can be for customers."

The key thing that has been learnt from the first week is that customers can help prepare for their switch by being ready to give their new bank or building society an up-to-date bank statement that shows their current address. Customers should also have their debit card with them - this helps ensure that the switch commences successfully as the new bank needs to record certain details from the customer's existing debit card. These items also enable banks to run the various checks that they need to undertake to help ensure the security of account switches.

The first month's official switching figures will be published during w/c 21st October.

The most popular questions customers asked during the first week about the new service were as follows:

Q1 What should I take with me to my new bank or building society?
A1 The requirements for opening an account will vary between individual banks and building societies, so please ask them to confirm what they will need from you. However, in order to ensure your switch is successful, it is advisable that as a minimum you should take a recent bank statement and your debit card so your new bank or building society can identify you and link you to your old accocount. Your new bank has to run various security checks to ensure you are who you say you are, and ensuring that the details you give your new bank match the details that your old bank has about you will help your switch run smoothly.

Q2 Does the Current Account Switch Service cover joint accounts?
A2 The Current Account Switch Service does cover joint accounts, but both named parties on the account will need to complete the relevant forms.

Q3 What if I'm overdrawn, can I still switch?
A3 Yes, and your new bank or building society may be able to provide facilities to help you pay off any overdraft, subject to their normal lending criteria. If this isn't the case you must make separate arrangements to repay your old bank or building society what you owe.

Q4 My new bank says I need to update my details with my old bank. Do I? Why?
A4 If the details you provide to your new bank do not match the details held by your old bank then you may be asked to contact your old bank to update the details they hold about you. Examples include if you have got married and not changed your maiden name to your married name or if you have moved house and not told your old bank your new address. When you are updating your details at your old bank you do not have to tell them that you will be switching to a new bank.

Q5 Will switching affect my credit rating?
A5 No, providing you repay any outstanding overdraft(s) on your previous account(s) as required by your old bank or building society. If there are any problems with payments (as part of the switching process) your new bank or building society will correct them and ensure your credit rating is not affected.

Q6 Do you have to close your old account as part of the Current Account Switch Service?
A6 Yes. Closure of the old account is part of the Current Account Switch Service process. This allows any payments made to your old account to be automatically redirected to your new account. You can switch and keep the old account open if you want to, but you won't be able to use the Current Account Switch Service - so you won't get any of the benefits detailed in the Current Account Switch Guarantee.

Q7 What should I do if my bank doesn't meet the seven working day guarantee? Will I get any compensation?
A7 If anything goes wrong with your switch then your new bank will refund you any interest (paid or lost) and charges made on either the old account or the new account. Whether you receive compensation above and beyond this is a customer-service issue for your particular bank to decide on.

Q8 Can I switch my savings accounts at the same time?
A8 The Current Account Switch Service is for current accounts only. If you would like to switch other account types, such as a savings account, you will need to ask your new bank or building society if they are able to help you do this.

Q9 Are account opening and account switching all part of the same process?
A9 Account opening and account switching are separate processes. Your new bank or building society has to carry out 'know your customer' security checks as part of their account opening process. Once these are complete to the satisfaction of the new bank or building society, you can choose and agree your switch date.

Q10 If the switch is delayed for any reason, can I use my new account straight away?
A10 Yes, if the new account is open and you have money in it (or an overdraft agreed) then you can use it. 

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