You are here: Home - Saving-Banking - Understanding - Mailbag: Can I switch current account if I’m in my overdraft?

Written by:
Dear, I want to switch my current account but I’m in my overdraft. Do I have to pay it off before switching? Helen, 28

The 7-day switching service, which launched in 2013, means switching current account provider has never been easier.

The service ensures all of your payments, both ingoing and outgoing, are moved to your new bank within seven days rather than the previous 18-30 working days.

If you’ve gone into your overdraft, you can still switch. However, industry experts say it is much easier to switch if you’re in the black.

Jody Baker, head of money at, writes: “It’s a good idea to try and clear any overdrafts before moving to a new banking provider.

“However, if this is not possible, when opening your new bank account, you need to be clear on the overdraft facilities provided by your new bank.

“If your new bank will provide you with an overdraft for the amount you need, then you can switch via the normal switching service. If it won’t, then you will need to pay off your overdraft before moving your account.

So, if you have an overdraft of £2,000 and your new provider will only give you a limit of £1,500, you’ll run into difficulties when switching.

Baker added: “It is quite a tricky position to be in as if you’re overdrawn, you won’t really know if you can get the bank account before you actually start going down the account opening process but where possible, clear any overdrafts before switching. Some bank accounts offer incentives to switch, so it is worthwhile exploring your options.”

The benefits of switching

The Competition and Market Authority (CMA) is mid-way through an investigation into the UK current account market.

Its initial findings revealed that customers could save £70 a year by switching to the cheapest provider, while overdraft users could save £140 a year and heavy overdraft users could save on average £260 a year.

Click here for more information on the 7-day switching service.



There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Big flu jab price hikes this winter: Where’s cheapest if you can’t get a free vaccine?

Pharmacies, supermarkets and health retailers are starting to offer flu jabs ahead of the winter season, but t...

Is now the time to fix your energy deal?

Fixed energy tariffs all but disappeared during the energy crisis. But now they are back with an increasing nu...

Everything you need to know about the pension triple lock

Retirees are braced to receive another bumper state pension pay rise next year due to the triple lock mechanis...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

The best student bank accounts in 2023: Cash offers, tastecards and 0% overdrafts

A number of banks are luring in new student customers with cold hard cash this year – while others are compe...

DIY investors: 10 common mistakes to avoid

For those without the help and experience of an adviser, here are 10 common DIY investor mistakes to avoid.

Mortgage down-valuations: Tips to avoid pulling out of a house sale

Down-valuations are on the rise. So, what does it mean for home buyers, and what can you do?

Money Tips of the Week