Starling, Monzo, Nationwide and Lloyds Bank gained the most current account customers during 2020, according to data from Pay UK.
The challenger banks once again managed to attract more customers than they lost last year, resulting in Starling making a net gain of 55,763, with Monzo just behind at 46,364. However, Lloyds Bank managed to exceed both banks’ net gains between 1 October and 31 December 2020.
At the other end of the scale, Santander, Barclays, Halifax and RBS saw the biggest losses in 2020.
Here, Which? looks into why people have been making a switch, and explains how to easily move over to a new current account.
Which banks and building societies are we switching to?
The most recent data from Pay UK shows the number of full account switches between 1 October and 31 December 2020.
The graph below shows how the banks’ and building societies’ figures changed – click on the tabs below to see the gains, losses and the combined net gains.
With a total net gain of 29,556, Lloyds Bank proved to be the most popular provider by quite a long way – the next-highest net gain was for Starling Bank at 15,960.
Lloyds Bank attracted 41,514 new customers towards the end of last year, perhaps due to its £100 switching offer which was launched in September 2020, at a time when few other switching incentives were around.
HSBC also reintroduced its £125 switching offer around the same time, but this hasn’t proved quite so successful. Despite attracting nearly 23,000 new customers, almost 27,000 left the provider, leaving it with an overall loss of 3,944 customers. This may be down to the fact that the bank announced it was considering charging for products like its standard current account.
These losses aren’t as big as those seen by the likes of TSB – which lost 20,236 customers over this period – and Santander, which ended up with 18,270 fewer customers.
Santander also saw some of the highest losses in the previous quarter’s results (covering 1 July-30 September 2020), possibly in response to several cuts and changes to its 123 current account.
The most popular banks of 2020
We’ve also knitted together Pay UK data for the whole of 2020 to show how providers fared over the whole year.
The figures for 2020 are very different from the trend we saw in 2019 when Nationwide dominated the net gains switching figures.
Instead, Starling Bank came out on top, with a net gain of 55,763 – beating its challenger bank rival Monzo along with all of the biggest high street banks, and pushing Nationwide into third place.
However, similarly to 2019, HSBC attracted the most new customers overall – a huge 115,579, in fact – but this number was tempered by its large loss of 102,584.
Its losses weren’t as large as Santander, however, which lost a total of 104,426 customers. This was far more than it gained, resulting in the largest net loss of more than 70,000.
Triodos gains customers throughout 2020
While it’s the banks with the largest figures that tend to get the most attention, Triodos Bank has been quietly building its customer base for some time now – and it seems to be picking up the pace.
Figures from 2019 showed a relatively modest net gain of 1,532, which has risen to 2,608 in 2020. But, for both years, it’s the bank with the fewest losses by far. In the whole of 2019 only 177 customers switched elsewhere from Triodos, and in 2020 only 235 people switched elsewhere.
But without the help of switching bonuses or trendy mobile apps, what’s the big appeal?
Triodos is a sustainable bank, which means it only invests in companies that focus on people, the environment, or culture. This includes companies involved with organic farming, renewable energy, day nursery childcare facilities, education, housing associations, and fair trade.
Its current account comes with few bells and whistles; it can be managed online or via a mobile app, comes with an eco-friendly contactless debit card (which is biodegradable and recyclable), and costs £3 a month. Triodos says this cost means there are no hidden fees, all customers pay the same amount, and the money goes towards the cost of running the account.
Did coronavirus affect switching?
It goes without saying that 2020 was a turbulent time for everyone, including the banks. All providers withdrew their switching incentives, and some accounts – such as First Direct’s current account – were closed to new customers while they tried to serve customers in financial trouble and deal with the various effects the coronavirus pandemic had on staffing.
As a result, switching dipped significantly between 1 April and 30 June 2020. From 113,037 switches taking place in March 2020, CASS saw just 41,000 switches in April and less than 30,000 in May and June.
Switching incentives began to return from September 2020; HSBC was the first to return, quickly followed by NatWest, RBS and Lloyds Bank, once more boosting the number of bank account switches.
How to choose a current account
If you’re happy with the service you receive from your current account, it’s not unusual to stick with the same provider for several years. However, there can be some great benefits to switching to a new account, including switching bonuses, or competitive savings rates that are only open to a provider’s current account customers.
Each year, we survey thousands of current account customers and undertake detailed product analysis to find the best and worst banks.
Depending on what kind of account you’re looking for, our other guides can help you decide which accounts could suit you best:
- Best high-interest bank accounts
- Best accounts for cashback
- Best bank accounts for arranged overdrafts
- Best packaged bank accounts
- Best basic bank accounts
Once you’ve decided which account you want to switch to, you can apply to open it. If the provider is part of the current account switching service (CASS), you should be able to open the account in seven workings days.
- Find out more: how to switch your bank account