HSBC data shows that 54% of people in Britain have had the same current account for over a decade and 2 in 5 remain at their same bank for over 15 years.

This is despite 64% of people reporting they receive no benefits at their current bank.

So, is switching bank accounts a good idea or not?

Switching your bank account is a personal decision and many people are happy to remain with their existing account for the simple reason of convenience. If you want better interest rates so you can earn on your savings then it could be beneficial to shop around for better deals.

Be careful not to switch too many times as this could affect your credit score!

 

Reasons for switching banks

  • Many banks offer rewards to new customers, you could receive a cash, travel, voucher rewards if you switch
  • A new bank could offer better interest rates than your existing one.
  • You may have had some issues with your existing bank account e.g. fraud issues or service and need a switch.
  • You may want to open a savings account with better interest and need to have a current account with the same bank first.
  • You want to open an appealing junior account for your children and you need your own current account at the same bank.
  • Your local branch shut down so you need to move to a bank with a branch nearby.

 

Does Switching banks accounts affect my credit score?

When applying for new bank accounts they will run a check on your file which leaves a trace on your credit report which other lenders later on could see.

With multiple checks on your file leaving a mark this could reduce your chances of being accepted.

When applying to a bank they will either run a hard or soft credit check, make sure to avoid too many hard credit checks as these leave a noticeable trace on your file.

If you plan on taking out a loan e.g. getting a mortgage within the next 12 months then you should wait before you switch bank accounts as the file will not have recovered from the credit check yet.