Current account switching service – a missed opportunity?
Between 1 July 2017 and 30 June 2018, nearly one million UK consumers (965,317) switched current account, up 6% on the previous 12 months. While this small increase is encouraging, the present switching rates are no better than they were in 2012, before the current account switching service launched. Despite it being easier than ever for consumers to switch current accounts, awareness of the scheme reaching around 84% in the past five years, and banks offering ‘golden hellos’, the conversion rate is much lower than expected.
With over 47 million current account holding adults in the UK, this year’s figures represent approximately a 2% switching rate – a number that certainly wasn’t envisioned when the switching service was set up. To try to accelerate this, banks are still continuing to compete with offers for customers that switch, however, they do not seem to be working – and many of those consumers that do make the switch decide to keep their old account open anyway. With awareness of the scheme at an all-time high, it is clear that UK consumers need more of an incentive to make the jump, and no matter how many people know about the scheme, it is only the banks that can make it happen.