How to switch banks: From low-cost overdrafts to interest on credit balances

Figures from the payments service BACS reveal that more than a quarter of a million people moved banks in the last three months of 2015. This means that 2.5 million customers have now used the official Current Account Switch Service.

Santander, Halifax and Nationwide building society are still winning the biggest share of current account movers, while Barclays and NatWest are losing the most customers to rival providers.

However, even with a switch guarantee in place, people don't always know which account to choose.

Although each bank and building society has its own tariff and rate details clearly displayed on its website and in marketing literature, working out which account is best can be a headache.

The dilemma for consumers is that no two accounts are the same, and the difficulty of comparing different rates and charging structures is probably one of the main reasons why customers put up with a below-average service.

There is not one bank account that is the perfect fit for everybody; it's more about weighing up the individual elements that are most important to you. For some people a low-cost overdraft will be the priority, while for others interest payable on credit balances will the key – or a debit card offering low-cost transactions abroad.

Here's what my research shows: if a cheap overdraft is most important, it's worth considering First Direct (first £250 interest free) or M&S Bank (first £100 free).

For those seeking interest on credit balances or reward for their custom, then for balances of £2,000 or less consider Halifax Reward or TSB Classic Plus; and for £3,000 take a look at Tesco Bank.

Lloyds and Santander 123 are tops for those with balances of £3,000-plus, with the latter being the market leader for balances of more than £5,000 – paying a very competitive 3 per cent gross, up to balances of £20,000.

While some people may be put off the Santander 123 account because of the £5 monthly fee, remember it also pays cashback on your utilities direct debits, which in many cases will more than offset the cost.

If you want a cheap debit card for use overseas then Norwich & Peterborough building society offers this facility free worldwide, while Nationwide and Metro Bank are much cheaper than the main banks in this area.

Picking the wrong bank when it comes to debit card costs overseas can cost a lot more than you'd imagine. There is more money to be saved in this area than any other element of a bank account. Bank customers could easily shell out an extra £50 or more in charges on their two-week summer holiday; for many, that's far more than the interest they will earn on their bank account in a whole year.

Yet for others it's not the nuts and bolts of the account that concerns them – all they want is the ability to be able to talk to a human being at a UK call centre 24/7, and to receive a good level of customer service, day in, day out. First

Direct and the Co-op continue to be the top performers for service.

If it's time you gave your bank the elbow, pick an account that reflects the way you run your finances – rather than being swayed by a cash sweetener, or a free meerkat.