Record number of savers switch bank accounts as they flock to cash perks
UK savers are more switched on than ever when it comes to their banking needs, as a record number of people moved accounts in the last three months of 2022, data reveals.
A total of 376,107 bank switches took place in the three months to December 2022, the highest quarterly figure ever recorded in the 10 years the switch scheme has been operating.
According to Pay.UK, which owns and operates the Current Account Switch Service (CASS), the record volume of switching coincides with the “challenging economic climate”, as well as “a number of strong incentives and offers from current account providers”.
It revealed monthly switching peaked in November at 157,376 – a record-breaking month – representing a 73% increase compared to the same period in 2021.
This appears to tie in with the Halifax offering switchers £175, with HSBC and Nationwide both offering £200 while First Direct continues its £175 cash bonus. At the time, Lloyds also offered £150 for new customers.
Meanwhile, October and December had 118,427 and 100,304 switches respectively, the data revealed.
Across 2022, there were 986,956 switches while 8.8 million have taken place since CASS launched in 2013.
Savers flock to Santander, HSBC and Starling
Based on customer switch data which is three months in arrears due to “commercial sensitivity”, Santander saw the largest number join the bank at 51,496.
However, 22,391 bolted the bank, meaning it was left with a net gain of 29,105 – still the largest across 47 participating banking brands.
In second place came HSBC which welcomed 46,744 new customers, but once the 33,625 who switched away were factored in, the banking giant was left with a net gain of 13,119 customers.
Digital challenger Starling came in third place, as 13,054 switched to it in the quarter to September 2022, with just 3,984 moving away. Overall, it was left with a net gain of 9,070 customers.
Monzo was also of note as this banking challenger saw 11,960 join, while 5,922 bolted, leaving it with a net gain of 6,038.
Digital banks continue to pull in switchers
Pay.UK said digital-only banks “continue to hold positions within the ‘top five’, despite the lack of incentive programmes”.
This suggests that “for many end-users, mobile banking and mobile app ease-of-use were important”.
It revealed at least two digital banks have appeared in the ‘top five’ performing current account providers in each quarter of 2022.
Meanwhile, end users cited online banking (46%) as the main reason for preferring their new account, followed by customer service (42%) and mobile banking/banking app ease (40%). However, the interest rate gained through a current account continues to be the fourth most important factor, with one in four (25%) noting this was a reason for them preferring their new account.
David Piper, head of payments cooperations at Pay.UK, said: “It is encouraging to see the highest level of switches ever this quarter, demonstrating the continued relevance of the service to consumers and businesses across the UK. It’s also positive to see an uptake in small business and charity account switches, showing that the value of the Current Account Switch Service extends beyond personal accounts.
“Those considering a new current account, for whatever reason, can be assured that the Current Account Switch Service has facilitated nearly 9 million switches through a quick, free and easy process.”