Current Accounts

A current account is a bank or building society account that allows you to manage your day-to-day spending.

You can have your salary paid into it, set up direct debits and standing orders and negotiate an overdraft. Some accounts also pay interest on balances and offer cashback on spending.

We’re getting generally better at switching financial products and shopping around for a better deal. But changing current account provider is something that continues to elude most of us. In fact, an estimated six out of ten adults have never switched their current account.

There are 54 million current accounts in the UK, making them big business for banks. And, as they know that once they’ve got your custom, they are unlikely to lose it, it can result in some uncompetitive deals and poor customer service.

The big four banks – Barclays, HSBC, Lloyds Banking Group and Royal Bank of Scotland, which owns NatWest – control more than 70% of the current account market, even though their standard current accounts pay paltry, and in some cases zero, interest. Their overdraft rates can be uncompetitive too, so why do so many people stay put?

The common perception is that switching current account is a lot of hassle for little gain but this isn’t the case. The Current Account Switch Service came into effect in 2013. Amid other consumer guarantees, it ensures the process takes a maximum of seven working days. So now is the time to stop being loyal to your bank and get more from your current account.

The assumption many people make is that current accounts are all pretty similar so it doesn’t really matter which provider you bank with. But, especially these days, that perception is a long way from the truth.

Some of the major providers are battling to attract new current account business by offering some fantastic deals, including upfront cash incentives. However, the product that is best for you will also depend on how you use your current account. So we’ve come up with some common customer profiles that should help you identify the key things to focus on when choosing a current account.

If your current account is usually in credit, look for a deal that pays a decent rate of interest – the choice of these is growing!

If you are usually overdrawn, look for the cheapest overdraft rates. Some accounts now also offer fee-free overdrafts for a certain time period.

Look at how you manage your bank account. Some current accounts are based online for example, so if you prefer to transact face-to-face in a branch, these won’t be right for you.

If you do require branch access, and see an account that looks attractive, think about where the nearest branch of that bank or building society is, as there’s little point moving your current account over if you’ll have to travel miles to get to a branch.

Think about whether you want to pay a monthly fee for a packaged current account which offers services such as breakdown cover and annual travel insurance.

Finally, if you frequently travel abroad, check out any foreign transaction fees for using your debit card, as these also vary.

Now that the majority of banks operating in the UK have signed up to the 7 day current account switching scheme, the process should take no longer than 7 working days.

When you want to switch current account, you’ll need to complete a Current Account Switch Agreement form, and on this you will select a day that you want the switch to occur. Seven working days prior to that agreed date, your new bank or building society will be in touch to confirm that the switching process has begun.

You will be able to use your old account right up until the switch has taken place, meaning you’ll always have a working bank account and won’t be stuck in limbo.

All of your incoming and outgoing payments will be transferred over; if there are any issues, your bank will be in touch. 

Each bank will have its own specific requirements, but generally speaking you will need an official proof of identification, plus proof of a UK address.

Proof of address will usually mean one of the following: a utility bill which is less than 3 months old, a tenancy agreement or mortgage statement, a recent bank or credit card statement, OR a current council tax bill.

Some banks and building societies offer cashback or rewards if you switch current accounts to bank with them. Check out the latest deals and offers here.

There are so many different ways to save money, from shopping around for your home energy and broadband bills, to not letting your car or home insurance auto-renew – making a start is sometimes the hardest part.

Take the first step today with these easy ways to start saving.

While switching credit cards is quite a usual occurrence for many people, switching current accounts is still quite uncommon. Many people still have the same current account they opened as a youngster. For this reason, banks can be quite competitive in offering incentives to switch. If you take the time to do some research and actually make a switch, you could get a great deal.

Once you’ve compared current accounts and found the right one for you, simply click through to your chosen bank or building society’s website and follow the instructions to open a new account.

Once you have done this, you will have to fill out a Current Account Switch Agreement form so your new bank or building society can begin the process.

Thanks to the Current Account Switch Agreement, the process should not take more than seven working days. You will be able to use your old account right up until the switch has been made to the new account, so you won’t be left in the lurch.

No, you don’t. Once you’ve filled out the Current Account Switch Agreement form with your chosen new provider, they will do all the work for you.

As part of the Current Account Switch Agreement, all payments coming in and out of your account will be redirected to your new account by your new provider for 13 months. During those 13 months, your new provider will also contact the sender to inform them of your new account details. If there are any problems with this process, your bank will contact you to make you aware.

For important payments into your account, like your salary, it makes sense to let your employer know, but the majority of these issues should be taken care of by your new provider.

The only thing you will probably need to change manually would be any recurring payments that were set up using the details of your debit card.

Our current account comparison service is completely free to use. We do not make any money from the comparison of different current accounts.

However, if you did decide to make a switch to one of the current accounts you found through our service, and clicked through to make the switch, we would receive a fee from that provider. If you cancel the switch, or the switch doesn’t go through for whatever reason, we would not receive a fee.

Some banks also work with us to help them keep their customers, so if you switch to a different current account but stay with the same bank or building society, that company will pay us a fee.

Find out more about how we work.