Best Current Account switching offers, cashback & incentives

From 16th September 2013 consumers have been able to switch current account within 7 workings days.

Previously, switching current accounts was seen as a nightmare taking up to 30 days to complete, plus there was little incentive to do so. It is perhaps unsurprising that consumers have typically only switched their bank once every 16 years. Yet banks are the biggest source of complaints to the Financial Ombudsman.

Switching bank accounts got a whole lot easier thanks to the Current Account Switch Service brought in by regulators in a bid to boost competitiveness within the banking sector. Plus there are now genuine incentives to change your bank or building society.

Switching current accounts is now quick and easy

Under the Current Account Switch Service consumers will be able to choose the date on which they want to transfer their current account and the whole process will not take more than 7 working days.

Direct debits and standing orders will also be automatically transferred across to your new account as will any payments sent to the old account (for a period of 13 months). If any payments are missed, they will guarantee to reimburse you in full.

Check who owns each bank before making a switch

The Financial Services Compensation Scheme (FSCS) protects your savings for losses up to £85,000 (£170,000 for joint accounts) should your bank or building society go bust, as long as it is authorised by the Financial Conduct Authority (FCA). However, the scheme protects your savings up to £85,000 per bank or building society providing the bank or building society has its own banking authorisation. Some banks and building societies share their banking license with other brands because they are part of a bigger group (for example HSBC and First Direct).

In these instances, you will only be covered for £85,000 across both banking brands for accounts in your sole name (£170,000 for joint accounts). Therefore it is important to ensure that you understand how switching bank accounts will impact your protection under the FSCS when viewed in the context of your existing accounts. This handy tool allows you to select the banks and building societies that you currently hold money with (or plan to hold money with) to see your level of protection under the FSCS if any of them were to go bust.

Best current account with an upfront bonus

Banks and building societies are offering some fantastic cash incentives to tempt customers away from rival banks. Below is a roundup of the best current account switching offers out there. Typically you have to close your old account once you've made the switch in order to receive the incentives. Most banks require a minimum monthly amount to be paid into the account to receive the bonus.

The current accounts with the best cash offers

HSBC Bonus - Switching criteria

To get the generous £175 bonus if you switch to HSBC's Advance account, you must:

• Switch within 30 days
• Have at least 2 outgoing direct debits or standing orders
• Pay in a minimum of £1,750 a month or £10,500 every 6 months
• Have not had a HSBC account in the past 3 years

To get the £75 switching bonus if you switch to a regular HSBC bank account, you must:

• Switch within 30 days
• Set up at least 2 direct debits or standing orders
• Have not held a HSBC account in the past 3 years

First Direct Bonus - Switching Criteria

To get the £100 bonus (and 0% overdraft) from the First Direct 1st account you must:

• Pay in £1,000 within the first three months of the account being open
• Have never held a First Direct account

Nationwide Bonus - Switching Criteria

To get the £100 bonus from the Nationwide FlexDirect/FlexAccount or FlexPlus account you must:

• Be referred by a friend who has a Nationwide current account
• Have 2 direct debits set up
• Have the account open for at least 3 months after switching or risk losing the £100 bonus

Best current account with cashback

Banks and building societies are offering some cashback incentives to encourage customers to switch providers and bank with them. Below is a roundup of the best current account switching cashback offers out there. You need to close your old account in order to receive the incentive and if you do this using the Current Account Switching Service (CASS) this is typically done for you. Most banks require a minimum monthly amount to be paid into the account to receive the bonus as well as at least 2 direct debits (over £2).

The current accounts with the best cashback offers

NatWest/RBS Cashback and Bonus - Switching Criteria

To get 2% cashback on bills with a NatWest Reward (or RBS) account you must:

• Pay £2 a month to receive 2% cashback on household bills paid by direct debit*
• Pay at least £1,500 in each month
• Log in to online mobile banking each month

*Rewards are changing from 1st February 2020. Instead of the 2% cashback you will receive £4 a month on 2 direct debits (over £2 each) and an extra £1 a month if you log in to the mobile banking app

Santander Cashback - Switching Criteria

To get 1-3%* cashback on bills with a Santander 123 Lite account you must:

• Pay £1 a month to maintain the account
• Pay bills via direct debit
• Pay in £500 a month
• Have 2 direct debits
• Log in to online banking every 3 months from account opening

*This is capped at £5 per month in each of the 1%, 2% and 3% cashback tiers from May 2020