The new Current Account Switch Service: Everything you need to know
Not happy with your business bank account? We take a look at the new service designed to make switching current accounts easy
Many small businesses might not be aware that, as of Autumn last year, switching current accounts for business banking is a much simpler and more pain-free process than ever before.
For those keen to move their business bank account, the Current Account Switch Service is designed as a hassle-free way of switching current accounts, without the lengthy delays and red tape normally associated with the process.
Many small firms put off changing accounts because of the potential impact it could have on their cashflow, but this shouldn’t be a concern with the new easy-to-use service.
Below, we have put together answers to the common questions business owners like you ask about the service and how it works.
What is the Current Account Switch Service?
Launched in September 2013, the Current Account Switch Service is a scheme designed to allow you to switch accounts quickly and easily between participating banks. Launched with the aim of minimising the logistical impact and red tape involved in changing current accounts, it allows you to completely switch over within seven working days once the new account has been opened, choosing the day of the switch on a date that suits you. The service is completely free to use, and designed to be as simple as possible – 87% of small firms who have made the switch said they found it easy to switch their current account.
Who can use the Current Account Switch Service?
The service is targeted at small businesses, small charities, and private consumers. The Current Account Switch Service defines a small business account as one with an annual turnover and/or balance sheet total that does not exceed €2m or sterling equivalent, belonging to a business which employs fewer than 10 people. If you’re larger than this, you may not be covered – talk to your new banking provider for advice on this.
Which banks participate in the Current Account Switch Service?
34 banks and building societies currently participate in the service – this includes most of the major players and, altogether, participating providers cover virtually 100% of the current account market. A full list of providers can be found on this page.
How long does it take to switch banks using the new service?
The process takes seven working days from the day the switching process starts to when the switch actually takes place. You can choose the date of the actual switch in advance, which means the process will begin six working days before that date.
What happens if someone tries to make a payment into my old account after the switch?
Any transactions made against your old account will be redirected to your new one for 13 months, and whoever is trying to make or take the payment will be supplied with your new information and advised to update their records. Regular payments to and from your old account, like Direct Debits and standing orders, are moved to the new account automatically.
How do I use the Current Account Switch Service?
The process is very simple. Just choose the new bank or building society you want to move to, open an account with them, and ask them to switch your old account using the Current Account Switch Service. You will then be asked to agree to the ‘Current Account Switch Agreement’ and the ‘Current Account Closure Instruction’ agreements, so the process can go ahead. After that, simply choose the date on which you want to switch, and let your new bank take care of the rest.
Will switching current accounts affect my credit rating?
As long as you pay off your outstanding overdraft and any other charges due under your old account, a switch using the service will have no impact on your credit rating.
What happens if I change my mind about switching?
Should you have a change of heart, you can cancel the process up to seven working days before the switch date.
Where can I find out more about the Current Account Switch Service and Guarantee?
Visit the Simpler World website; this contains a full list of participating banks and building societies, a full guide to the switching process, and the full text of the Current Account Switch Guarantee. You can also follow the service on Twitter: https://twitter.com/switchbizbank