Halifax, Nationwide, HSBC and Starling Bank have gained the most current account customers in the first three months of 2018, as people vote with their feet and leave their previous providers, new figures from Bacs reveal.
Almost half a million (499,801) switches were completed in the first quarter of 2018, up 7% compared with the same period in 2017.
A total of 226,331 switches recorded in the last quarter alone (April to June), a year-on-year increase of 4%.
Which? takes a look at the banks and building societies most people are switching to and offers advice about how to pick the best bank account for your next move.
Which banks are we switching to?
For the first time, Bacs has released switching data three months in arrears instead of six months, giving us a more up-to-date snapshot of the banks and building societies attracting the most new clients (or losing them).
The table below shows the banks we switched to between 1 January and 31 March 2018.
|Brand||Gains Q1 2018||Losses Q1 2018||Net gains/losses Q1 2018|
|HSBC ( includes First Direct and M&S Bank brands)||56,159||35,274||20,885|
|Low volume participants*||1,680||773||907|
|Bank of Scotland||4,378||4,354||24|
|Bank of Ireland (includes Post Office brand)||119||919||-800|
|AIB Group (UK) PLC (includes First Trust Bank and Allied Irish Bank brands)||47||1,080||-1,033|
|RBS (includes Adam & Company, Coutts and Isle of Man brands)||1,487||12,509||-11,022|
|Clydesdale Bank (includes Yorkshire Bank brand)||2,030||13,861||-11,831|
|Co-operative Bank (includes Smile brand)||612||14,720||-14,108|
*Low volume participants comprises: Arbuthnot Latham, C Hoare & Co, Commerzbank, Cumberland Building Society, Hampden & Co, Investec, Monzo Bank Limited, Reliance Bank, Spectrum Financial Group, Triodos Bank, Virgin Money & Weatherbys Bank.
Current account switching: winners and losers
Over the first three months of 2018, Halifax gained the most customers overall with a net gain of 33,942.
Earlier in the year, Halifax offered a £125 bonus to those that switched to its range of current accounts. Today you can get a smaller £75 for making the move.
Nationwide, which is a Which? Recommended Provider, attracted the second largest net influx of customers with an overall gain of 28,763 accounts.
The brand offers a range of current accounts including the fee-free Flex Direct, which has a market-leading rate of 5% on balances up to £2,500.
HSBC, along with its First Direct and M&S Bank brands, collectively were the third most-switched to provider in the first quarter of this year, with a net gain of 20,885.
HSBC was initially offering switchers £150 to move to its range of accounts while First Direct offered £100 and M&S Bank £125 in vouchers. Today, though there’s currently no switching bonus to move to HSBC and First Direct has replaced its £100 offer with a range of free gifts.
Starling Bank was the fourth most-switched to provider at the beginning of this year and makes its first entry into the switching data.
The digital-bank offers users a simple way to open and manage a single or joint account that comes with 0.5% interest on balances up to £2,000 and 0.25% on balances over £2,000 up to £85,000 plus no fees on overseas spending or cash withdrawals.
Find out more: Challenger and mobile banks
By contrast, Barclays had a poor start to the year by making the biggest net loss with 17,628 accounts moving overall.
TSB, meanwhile, experienced a net reduction of 5,126 customers over the first quarter of the year, though this shouldn’t be pegged to the bank’s well publicised IT meltdown, which occurred in April.
The most popular banks of 2017
The latest figures from Bacs also reveal the current account providers we switched to between 1 October 2017 and 31 December 2017.
We’ve knitted together this information with the other three quarters of 2017 to establish who the most switched-to provider was last year.
|Brand||Net gains/losses 2017|
|HSBC ( includes First Direct and Marks & Spencer Bank)||15,096|
|Low volume participants*||3,956|
|Bank of Scotland||1,457|
|Bank of Ireland (includes Post Office brand)||-1,896|
|AIB Group (UK) PLC (includes First Trust Bank and Allied Irish Bank brands)||-6,196|
|Clydesdale Bank (includes Yorkshire Bank brand)||-7,033|
|RBS (includes Adam & Company, Coutts and Isle of Man brands)||-31,495|
|Co-operative Bank (includes Smile brand)||-37,253|
*Low volume participants comprises: Arbuthnot Latham, C Hoare & Co, Commerzbank, Cumberland Building Society, Hampden & Co, Investec, Monzo Bank Limited, Reliance Bank, Spectrum Financial Group, Starling Bank Ltd, Triodos Bank, Virgin Money & Weatherbys Bank
Nationwide was the runaway winner in 2017 with the brand managing to make a net gain of 131,744 customers over the period. The building society has remained consistent with its current account range even as its rivals made cuts to perks.
The Nationwide FlexDirect account for example still offers 5% interest on balances up to £2,500 for 12 months, while rival accounts from Lloyds and Bank of Scotland have been scaled back.
TSB also had a stonking year in 2017 managing to make a total net gain of 52,588 customers. However, it’s likely that this winning-streak will be short-lived following the IT meltdown the bank went through earlier this year.
The extent of how damaging the incident was for TSB will not become apparent until Bacs publishes the next current account switching figures covering the period of 1 April to 30 June 2018 in October later this year.
Should you switch your bank account?
Many of us will open a current account and never think about it again, but you could be missing out.
While well-known names like HSBC, Lloyds, Halifax and Nationwide offer perks like cash incentives for switching or interest, there are a growing number of challenger banks making useful innovations.
Starling Bank has recently re-invented the debit card and launched a vertical piece of plastic to better suit how we use it and launched the ability to open a joint account in under five minutes, Monzo has launched a current account that offers fee-free spending abroad and an overdraft, while Revolut has launched disposable virtual cards to fight online fraud.
So if you’ve had the same current account for more than a year, it’s worth reviewing if it’s still the best deal for you.
Find out more: Challenger and mobile banks
How to pick a bank to switch to
You can see detailed reviews of bank accounts which include our unique Which? customer scores in our guide to the best and worst banks.
To find the right current account to switch to, it’s worth doing some research about the accounts that could fit your needs. We have a range of guides that are worth delving into to help you decide:
- Best high-interest bank accounts
- Best accounts for cashback
- Best bank accounts for arranged overdrafts
- Best bank accounts for unarranged overdrafts
- Best packaged bank accounts
- Best basic bank accounts
You might also want to consider how many branches banks have said they are closing and if your local one is being shut down as well as what they are like to deal with in cases of fraud.
How to switch your bank account
Once you’ve found the bank account you want to switch to, you just need to apply online, over the phone or in a branch to open it.
If the provider you are using is part of the Current Account Switch Service or CASS you will have the option to switch your current account in seven working days.
The process is largely automated and your new provider will move over all your direct debits, standing orders and incoming payments for you within the time period agreed.
Read more: How to switch your bank account or watch our video below.