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27 Apr 2019

Revealed: the banks that thousands of customers are switching to

Find out which banks were most in-demand from customers

Nationwide, HSBC and Monzo attracted the most customers looking for a new home for their current account in 2018, new figures from Bacs reveal.

These providers have been tempting people to switch away from other banks with big cash bonuses, high levels of credit interest and fee-free spending abroad.

Meanwhile, TSB, which suffered a botched IT migration and months of service disruption, unsurprisingly shed the most customers overall last year, followed by Royal Bank of Scotland.

Which? takes a closer look at the current account providers we're flocking to and explains how to make a move if you're tempted to switch this year.

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Which banks and building societies are we switching to?

The latest data from Bacs reveals the current account providers that most people chose to switch to between 1 October 2018 and 31 December 2018.

We've knitted this data together with figures from the rest of 2018 to find out who the most and least popular providers were last year.

Source: Which? analysis of Bacs data from January to December 2018

Nationwide - a Which? Recommended Provider - was the clear winner in 2018. It attracted the largest net influx of customers, with a total gain of 131,440 accounts over the year.

Its success could be down to the appealing perks it continues to offer on its current accounts. The Nationwide FlexDirect account, for example, still offers 5% interest on balances up to £2,500 for 12 months, at a time when rival accounts from Lloyds and Santander have scaled back their perks.

HSBC, which includes the First Direct and M&S Bank brands (also Which? Recommended Providers), also had a strong year in 2018. Collectively, they were the second most popular providers last year, with a net gain of 94,309 accounts.

All three brands offered big switching bonuses and incentives throughout 2018 to tempt customers. HSBC offered switchers £150 to sign up and a further £50 if they stayed for 12 months. First Direct went from offering free gadgets to reverting back to its £100 offer, while M&S Bank offered new customers £125 in vouchers.

Today, HSBC no longer offers a switching bonus but First Direct still offers £100 and M&S Bank has upped its offer to £180 in vouchers if you switch and stay.

Challenger bank Monzo beat many big-name providers to be the third most popular option in 2018, according to our analysis. The app-based bank has been growing a strong following over the past few years and recently became a Which? Recommended Provider.

Monzo offers an account that comes with fee-free spending abroad and useful budgeting tools. It has steadily been adding features to encourage people to make it their main bank account, including launching an overdraft and linked saving accounts.

You can see the full list of the biggest providers below.

BrandAccount gains 2018Account losses 2018Net account gains/losses 2018
Tesco Bank5,8054,3511,454
Low volume participants5,4174,0901,327

Source: Which? analysis of Bacs data from January to December 2018

Low volume participants comprise Arbuthnot Latham, C Hoare & Co, Commerzbank, Cumberland Building Society, Hampden & Co, Investec, Monzo Bank Limited (only in Q1), Reliance Bank, Spectrum Financial Group, Think Money Ltd, Triodos Bank (Q1 and Q2), Virgin Money & Weatherbys Bank switches. Grouping: AIB Group (UK) p.l.c. includes First Trust Bank and Allied Irish Bank (GB). Bank of Ireland includes the Post Office. Clydesdale Bank includes Yorkshire Bank. Co-operative includes Smile. HSBC includes First Direct and Marks & Spencer Bank. RBS includes Adam & Company, Coutts and Isle of Man.

Data from Handelsbanken and Metro Bank was not provided in 2018.

Read more:best and worst banks

How to pick your next current account

If you aren't satisfied with the perks or service offered by your bank, it's worth considering something new.

Many brands have ramped up the offer of cash incentives to switch. NatWest and RBS are now offering £175 to new and existing customers that switch and stay for a year.

But you can also earn a £180 M&S gift card when you switch to M&S Bank and stay for a year; £135 from Halifax when you switch and stay for at least six months; or £100 for switching to First Direct.

Switching incentives shouldn't be the only thing you consider, however. It's also worth weighing up the interest rate, and customer service you might experience. Which? offers detailed reviews of bank accounts in our guide to the best and worst banks.

You can also make use of our range of guides to help find the right account for your needs:

It's also worth researching how many bank branches your new provider will have and whether your local one is being shut down, how good it is at dealing with cases of fraud and the regularity of IT glitches that impact on its service.

How to switch your current account

Once you've selected the 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 is part of the Current Account Switch Service (CASS) you will have the option to open the account in just seven working days.

You can find out how it works in our guide on how to switch your bank account or watch our video below.