How to switch your bank account

The five Easy-PC steps to switching your bank account today.

There has never been a better time to switch your bank account. Research from Which? magazine shows that consumers can save more than £200 a year by moving to a different bank. Some of the new accounts are telephone or online only, so bear this in mind when you’re comparing your options. Here’s the peopleschampion.com guide to moving:

Step One: Choose a new bank account that best suits you best. There is plenty of choice. Then get in touch with the bank you want to move to for an application form to set up a new account. This can be by phone or by popping into a branch. Your new bank will need proof of your identification and your address. A passport and driving licence are normal, and the bank will have to undertake some money laundering checks too. Give the bank details of your income and any outstanding credit agreements. This is your mortgage, credit cards and other loans. Your new bank will then get things moving – and decide whether to accept you as a new customer.

Step Two: Great news. Your new bank does want to have you as a customer! You will be asked to sign a mandate allowing your new bank to ask your old bank for details of your Direct Debits and standing orders. You’ll also find out when you can start using your new account. Often, you can start immediately, although it might be better to wait until everything is switched over. Your new bank will be able to advise you on this.

Step Three: Your new bank will be busy behind the scenes, so don’t fret. Your new bank has to contact the old bank for a list of any other payments, they will then contact any companies that you pay Direct Debits to and ask them to switch. The new bank will cancel the payments at your old bank. Your job is to inform your place of work about your new bank detail – you want to make sure your salary goes into the new account! Contact your employer and give them your new account details, which will be the name of the account, the six-digit sort code, and your new account number.

If you have a pension or share dividends you’ll need to let these people know you’ve switched. It’s fairly easy though. Again keep your new bank up to speed and if you have any problems, they can help. There might be a point where they can help with a temporary overdraft facility to cover any payments in the meantime.

Step Four: Switching banks can take some time – especially with all the extra regulatory work banks must undertake today. So you must keep a beady eye on both accounts. It is possible that payments can be made from either account during the transition, so it’s worthwhile ensuing that you’re not accidentally overdrawn or hit by bank charges. Your old bank are duty-bound to be polite and helpful, so you shouldn’t have a guilt trip about leaving a bank you’ve been with since you were a toddler!

Step Five: The job is done. The bank switch is nearly done. Let your new bank know how it has gone for you – any problems or issues. Once the bank is happy that all of your payments have been switched they will ask the old bank to cancel any obsolete Direct Debits. If you want to tidy things up, you can then close you old account. Now, wasn’t that all painless?

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