Current account switching picks up pace in July before interest rates cut
However, the total number of switches slowed between July and September compared with the first half of 2024.
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More than 100,000 current account switches took place in July as people locked into better savings deals before the Bank of England cut interest rates, new data has shown.
However, the total number of switches slowed between July and September compared with the first half of 2024.
The Current Account Switch Service revealed that 247,729 switches took place over the three-month period.
The service, which helps people choose between more than 50 different banks and building societies and change their provider, tracks the level of activity each month.
It found that July was the busiest month of the quarter with 107,148 switches taking place.
It came as the Bank of England implemented in August its first interest rate reduction since the pandemic, taking the level down to its current 5%.
This prompted a fall in rates on easy-access savings accounts, with data from Moneyfacts last month showing the biggest month-on-month drop since April.
Nevertheless, competition to attract current account customers has grown in recent months, with new cash incentives being launched to the market.
Nationwide Building Society is currently offering a £175 switching incentive, as is First Direct, while the Co-operative Bank recently launched a new offer of up to £150 to switch current account.
Santander welcomed the greatest number of new customers between April and June, with 58,070 net gains, according to the most recent data supplied by the Current Account Switch Service.
Santander’s £185 switching offer ended at the beginning of April.
This was followed by Nationwide, with 22,894 net gains, and NatWest, with 5,080.
Banks and building societies are actively developing, and announcing, new innovative incentives, often packaging multiple offers together to sweeten the deal
The service said it has facilitated 11.1 million switches since it was launched 11 years ago.
John Dentry, product owner at Pay.UK, owner and operator of the Current Account Switch Service, said: “The service sits in the centre of an increasingly competitive and dynamic banking market.
“Banks and building societies are actively developing, and announcing, new innovative incentives, often packaging multiple offers together to sweeten the deal.
“We are also seeing a stream of new products and perks to help entice consumers, and, with this backdrop, consumers should keep their eye on their provider and the wider market to ensure they’re with the bank that best suits their needs.”