In today’s financial climate, switching current accounts to try and save money or reduce costs can be appealing. Plus, as banks are competing for your custom, many offer perks and incentives to tempt you. But before you make the switch, it’s important to understand which things you should consider.
Benefits of Switching Current Accounts
Switching your current account could have various upsides, such as:
- Cash/gift incentives: Several banks will offer cash bonuses (up to £200 in some cases), or gift vouchers, as promotional rewards for opening an account.
- Better interest rates: Certain current accounts provide a higher rate of interest – ideal for customers that tend to be in a positive balance.
- Lower fees: For those who occasionally find themselves overdrawn or subject to other charges, some accounts have lower fees.
However appealing any apparent perks may seem, it’s vital to do your research on any conditions or restrictions that apply before you jump ship.
Customer Features
Beyond initial incentives, you should also explore which banks offer the features that are most important to you. These could include:
- Digital first tools (online banking, user-friendly mobile app)
- Supplementary services (budgeting tools, travel insurance)
- Enhanced customer services (check online reviews to gain insights into the bank’s reputation for supporting its users)
What Do I Need to Know Before Switching?
Many current accounts will require at least two active Direct Debits (and possibly a set number of transactions per month) in order to qualify. Others may have a minimum amount that needs to be deposited monthly, to avoid fees.
If you’re overdrawn, your new bank may agree to accept the overdraft balance as part of the switch – but check first to avoid having to make repayments to your previous bank. Most banks will also perform a basic credit rating check before agreeing to take you on as a customer.
For an up-to-date list of detailed current account offerings, explore comparison sites such as MoneySavingExpert and USwitch.
Can I Switch Current Accounts If I’m on Universal Credit?
There’s no reason you can’t change your current account if you’re receiving Universal Credit.
But you should do so via the Current Account Switch Service (CASS), a scheme that includes enhanced security and anti-fraud measures. CASS is free, independent and has been used by millions of customers to change between more than 50 financial institutions.
Banks may still carry out standard checks when you apply for the new account, but your benefit status is not a barrier. Your Universal Credit payments will still be paid as normal as long as your new account details are updated with the Department for Work and Pensions.
After you switch, you may receive a request to visit a local Jobcentre after doing so – but this should be a simple ID check for security reasons.
Ready to Make the Switch?
It’s important to recognise that not all bank accounts are accessible to everyone, so check the eligibility criteria for your preferred option. Carefully research your options, or seek professional advice on what to look out for during the switching process.
If you need any support navigating your financial journey, contact us to talk to a member of our helpful team via phone, email, WhatsApp or online chat.
