BANKS are offering hundreds of pounds in cash and freebies to persuade customers to switch current accounts.
The deals include up to £200 cash, free gifts and cashback on spending.
Here, finance writer Rosie Murray-West analyses whether the perks are worth it.
NATIONWIDE is paying £200 to qualifying existing members, while First Direct, Lloyds and Santander are offering £175 and TSB £100 for switches.
But there are lots of other offers, too.
Many banks now give cashback on current account spending and offer top easy-access savings rates.
For example, Santander’s Edge account pays 1 per cent cashback on bills paid via direct debit and 1 per cent cashback on grocery and travel spending.
There is a maximum earning of £10 a month on groceries and travel and £10 on bills.
It also has a linked 7 per cent easy- access savings account with a maximum balance of £4,500.
Top rates elsewhere are at 5.2 per cent.
Club Lloyds is offering a 6.25 per cent regular saver, paid after 12 months, plus other extras such as a 12 months’ subscription to Disney+ worth £60 a year or six free cinema tickets per year.
YOU must meet each bank’s criteria to get its switching reward.
Before you take the plunge, check whether you must pay in a minimum amount each month or have a minimum number of direct debits, advises Andrew Hagger, from finance website MoneyComms.
Some accounts also come with a monthly fee, which could leave you out of pocket.
For example, Santander’s Edge account costs £3 per month, meaning it knocks £36 a year off your cashback or free cash offer.
Additionally, when you switch bank accounts this may be flagged on your credit file.
“It’s best to hold off for six months if you know you’re going to need to apply for a mortgage,” says Matt Sanders, from comparison website Go Compare.
IF you have the time, it could be worth the money.
Matt says: “Everyone should look into switching. It’s a simple process and can be very rewarding.”
Banks hope that the incentives will persuade customers to stay with them, but Matt says there is nothing to stop you from taking the money and switching again and banking hundreds of pounds.
Statistics show that plenty of us are doing just that.
The Current Account Switch Service, which makes switching easy, says 2023 was its busiest year for a decade and 2024 is following suit as customers dash for cash.
If you do plan on moving banks for the long-haul, rather than just tapping into the cash reward and bolting, then do your research.
Add up whether the perks you will receive are useful to you.
WELLBEING retreat organiser Abby Knight, 59, made an easy £175 by moving her current account to Lloyds from Nationwide.
She says: “I’m not great at that kind of thing. Whenever anyone tells me I should go on Compare The Meerkat or whatever it is to find the best deals, I never do.
“My son, who has a Lloyds current account, told me it was a no-brainer.”
The switch took Abby, from Maldon in Essex, less than ten minutes and she has already put the money towards a trip to Spain.
She says: “Within seven days the money was in the bank. I didn’t have a huge number of direct debits on that account, but they were important things like life insurance – and obviously I wanted to make sure that they went through.
“But it was pretty much instantaneous with the switching,and the direct debits were all fine.”
SWITCH FOR SUCCESS
FOLLOW these steps to make a successful switch and bag a perk
Step 1: Choose a new account with a switching perk.
Check it is suitable in other ways, including the overdraft charge, any monthly fees and any fees for spending abroad.
Step 2: Check you are eligible for the perk.
Ensure that you can meet the requirements to get the reward, which may include not having had a bonus from that bank before.
You may need to ensure you have sufficient direct debits on your account before switching.
If you do not, you could set some up for household bills or some small ones to charity.
Step 3: Open the new account in-app or online.
This may require ID such as a passport or driving licence.
Step 4: Choose a switch date.
When you apply for an account, you should be asked whether you want to switch an existing bank account.
You should say yes and pick a day seven days in the future for the switch to complete.
Step 5: Wait.
The whole process should take seven days, after which your account and direct debits should be switched.
Each bank has different timelines on when any cash reward will be received.
Other rewards, such as linked accounts, should also be available in your app.
Step 6: Switch again.
If you have received the reward you wanted and would like to receive more, start the process again with another bank that offers a cash sweetener.
IF IT GOES WRONG
CONTACT your new bank and quote the Current Account Switching Rules, which you can find on its website (currentaccount switch.co.uk).
If you are out of pocket because of missed payments due to the switch, your bank needs to refund you under the terms of the guarantee.
