Current account switches match Q3 2020 levels.

In this latest dashboard we find out how many of us transferred our bank account in Q1 2021 during Lockdown 3.0 and who the switching winners and losers were as restrictions had eased slightly for many during Q4 2020 and incentives had returned within the market.

The number of switches during 2021

As previously reported the steady state of Current Account Switches was disrupted by the emergence of the COVID pandemic in the first half of 2020.

Although the number of switches began to rise during the Autumn, the December switching level had fallen to 41,357 (a mix of seasonal and lockdown factors are the probable cause). While current account switches dipped in January (31,854) and February (42,398), there was a significant increase in March (63,724) as the roadmap for the COVID-19 recovery became clearer.

Source: Pay.UK

A total of 7.2 million current accounts have now been switched since the service was launched in September 2013.

As we moved into 2021, many of the trends from a difficult and unusual 2020 followed as the pandemic developed and the financial ecosystem continued to adapt. Through a fast changing market The Current Account Switch Service remained focussed on its priority objectives, to ensure that the service is available to those who wish to move their current account in a simple, reliable and stress-free manner. To that end, I’m proud our team has been able to maintain its exceptional 99.8 per cent completion rate into 2021 and awareness and satisfaction levels were above target. Into 2021 and beyond, we’re dedicated to ensuring that the service remains reliable and available to anyone who wishes to move their current account to one that suits them better.

David Piper, Head of Service Lines at Pay.UK, owner and operator of the Current Account Switch Service

During Q1 2021, 137,976 current account switches have been completed – a significant (COVID) reduction on the historic number of switches as Lockdown 3.0 continued to impact activity.

Q1 2021: CASS performance

The CASS insights published by Pay.UK (the operator of the switching service) show us that during Q1 2021:

Source: Pay.UK
  • . A total of 137,976 switches took place in the first quarter of 2021, a figure almost identical to total switches completed in the third quarter of 2020 (136,575) when similar social distancing measurers were in place for many.
  • Q1 2021 figures reflected a drop of 51,297 compared to the final quarter of 2020 (189,273), where social distancing measures were relaxed for many and participants started re-introducing switching incentives to the market. While current account switches dipped in January (31,854) and February (42,398), there was a significant increase in March (63,724) as the roadmap for the COVID-19 recovery became clearer.
  • Since the service launched in 2013, successfully redirected more than 106.9 million payments seamlessly and transparently from an ‘old’ (and closed) bank account to the ‘new’ bank account. One of the early fears for the CASS service was that payments directed to the ‘old’ bank account would result in ‘lost’ payments, the development of a ‘redirection table’ has proved to be an integral part of ensuring the success of the accounts witching service.
  • Consumer awareness of the Current Account Switch Service was at an average of 76% through Q1 – edging ahead of 75% in Q4 2020.
Source: Pay.Uk
  • 93% (up 2% from Q4) of people who have used the service over the last three years are satisfied with the CASS service:
Source: Pay.UK
  • Despite the disruption caused by COVID, 99.8% (no change) of switches have been completed within the seven working day switch timescale.
  • December 2020 had recorded the highest proportion of small business and charity switchers accounting for 12% of switchers (personal 88%) This increased further in January 2021 with the proportion being 14.9% and 85.1% respectively
  • In Q1 2021 93% of CASS switchers would recommend the switching process.
  • Of those who have switched account, 71% say their new current account is better than their old one and only 3% say it is worse.
  • The top three reasons people rate their new account as better than their old account continue to be service related:
    • Online banking (51%) (Q4 2020 40%)
    • Mobile banking (37%) (Q4 2020 40%)
    • Customer service (44%) (Q4 2020 36%)
  • The proportion of current account holders actively considering switching stands at 13% and a further 14% are thinking about it.
  • Over three quarters (81%) think that it would be easy to switch.

Q3 2020: Participant performance

Pay.UK publish participant CASS data a quarter in arrears so the latest data provides an insight to switches completed in Q4 2020:

Source: Pay.UK
  • Of the 49 brand participants 9 brands recorded a net gain of accounts (note: a number of brands are included in a catch all ‘low value participant’ category which recorded 371 gains and 1,988 losses so it is possible that an individual brand or two made a small net gain).

Q4 CASS winners and losers by brand

Pay.UK publish the winners and losers information in alphabetical order but sorting based on net gains / losses provides an interesting picture of winners and losers on an individual brand level:

  1. Lloyds Bank: +29556
  2. Starling Bank: +15960
  3. NatWest: +9,003
  4. Clydesdale Bank: +8584
  5. Monzo Bank Limited: +6765
  6. Triodos Bank +1043
  7. RBS: +1013
  8. Bank of Scotland: +627
  9. Ulster Bank: +317
  10. Danske : -242
  11. AIB Group (UK) p.l.c.: -310
  12. Bank of Ireland: -374
  13. Co-operative : -1729
  14. Tesco Bank: -2487
  15. HSBC: -3944
  16. Barclays: -6398
  17. Nationwide: -6454
  18. Halifax: -11231
  19. Santander: -18270
  20. TSB: -20236

Q4 CASS winners and losers by banking group

Pay.UK publish the winners and losers information in alphabetical order by brand but sorting based on net gains / losses by banking group provides an interesting picture.

By banking group Lloyds Banking Group continues in top place but at a reduced margin compared to the single brand above.

  1. Lloyds Banking Group: +18952
  2. Starling Bank: +15960
  3. NatWest Group: +10016

At the other end of the table the participants are unchanged by group:

19: Santander: -18270 and 20: TSB: – 20236

Conclusion

As previously reported the steady state of Current Account Switches was disrupted by the emergence of the COVID pandemic in the first half of 2020. Although the number of switches began to rise during the Autumn, the December switching levels fell to 41,357 (a mix of seasonal and lockdown factors are the probable cause of this dip). While current account switches dipped in January (31,854) and February (42,398), there was a significant increase in March (63,724) as the roadmap for the COVID-19 recovery became clearer.

However, whilst this was true of personal current accounts in Q4, December 2020 had recorded the highest proportion of small business and charity switchers accounting for 12% of switchers (personal 88%). This increased further in January 2021 with the proportion being 14.9% and 85.1% respectively.

The top three reasons to switch (online banking, mobile banking and customer service) continue to point to current account providers having a strong digital offering although incentives will have played a part in Q4 2020.

The key service factors of the CASS service of the 7 day switch guarantee, consumer awareness, consumer confidence and account redirection have all performed highly during Q4. This is evidenced by the 93% of people who have used the service over the last three years being satisfied with the CASS service.

With 13% of current account holders actively considering switching and a further 14% thinking about switching the service performance and consumer satisfaction point to the CASS service will continue to play its part in stimulating a competitive current account market in the UK – which, after all, was the key driver for the development of the CASS service.