Seven-day account switch attracts 89,000 people
Over 10% more people switched current account in the month following the introduction of the Payments Council's new seven-day switching service.
The Payments Council said 89,000 people switched accounts between 16 September - when the scheme was launched - and 21 October. This was an 11.25% increase on the 80,000 people who switched during the same period of last year.
The new service means consumers can switch current account in just seven working days - a vast improvement on the old process, which took between 18 and 30 working days.
Responsibility for both incoming and outgoing payments now lies with banks rather than consumers, meaning all outgoing payments (such as Direct Debits and standing orders) plus those coming in (such as your salary), will be transferred automatically from the old account to the new one.
A new redirection service ensures that any payment made into someone's old account will be switched automatically to the new one – for up to 13 months after the switch date.
However, critics said that the latest figures are only on track to match the number of people who switched in 2012.
Adrian Kamellard, chief executive of the Payments Council, said: "We never expected that every customer who is tempted to switch would rush out to do so at launch, but this is an encouraging start.
"This service is all about customers and the focus continues to be on them. Across the entire industry huge amounts of work continue to be put in to ensure that customers get the commitments made in the guarantee. It is by getting this right that we can deliver on the objectives of increasing competition and providing greater choice for customers."
Kevin Mountford, head of banking at MoneySuperMarket, said the figures were "encouraging". But he added: "Expectations across the industry may have been higher. It is still early days and the fact that there have been so many successful, uncomplicated switches thus far is a big thumbs up for the industry.
"I hope this will encourage even more consumers to get up off their laurels and start the current account switching process today."
MoneySuperMarket research shows a 52% increase in the number of people looking to switch their bank account compared to last year, and a 70% increase in the number of people actually switching.
An account opened with a clearing bank (few building societies offer current accounts) that provides the ability to draw cash (usually via a debit card) or cheques from the account. Some pay fairly minimal rates of interest if the account is in credit. Most current accounts insist your monthly income (salary or pension) is paid directly in each month and they offer a number of optional services – such as overdrafts and charge cards – which are negotiable but will incur fees.