Current account switches increase by 29855 in Q3 compared to Q2

In this latest dashboard, we find out how many of us transferred our bank account in Q3 2021 and who the switching winners and losers were in the three months of the year following Lockdown 3.0.

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 being the probable cause).

Source: Pay.UK

While current account switches dipped again in January (31,854) and February (42,398) as Lockdown 3.0 took hold, there was a significant increase in March (63,724) as the roadmap for the COVID-19 recovery became clearer. This recovery has continued as restrictions have continued to ease. During Q2 2021 182745 current account switches were completed, 44769 more than in the previous quarter. The number of switches rose by a further 29855 in Q3 2021 with 212600 switches taking place between July and September.

Source: Pay.UK

A total of 7.6 million current accounts have now been switched since the service was launched in September 2013.

“The number of Current Account Switch Service users rose in Q3 as consumers continued to explore digital options and switching offers. The return of competitive incentives being offered by participating banks and building societies is a strong sign of confidence returning to the market. This growth is encouraging and as we look to the end of the year our focus remains on ensuring our service is widely available to those looking to switch accounts in a simple, reliable, and stress-free manner.”

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

Q3 2021: CASS performance

The CASS insights published by Pay.UK (the operator of the switching service) show us that during Q3 2021:

Source: Pay.UK
  • A total of 212600 switches took place between July and September 2021, 29855 more than in the previous quarter.
  • In the past 12 months 722594 switches in total have been processed through the service.
  • Since the service launched in 2013, the system has successfully redirected more than 113.4 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 switching service.
  • Consumer awareness of the Current Account Switch Service was at an average of 75% through Q3.
Source: Pay.UK
  • 91% of people who have used the service over the last three years are satisfied with the CASS service:
Source: Pay.UK
  • 99.7% 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. Levels for small businesses and charities then fell back to historic levels and this has continued with the proportion at 2% in September 2021.
  • In Q3 2021 89% of CASS switchers would recommend the switching process.
  • Of those who have switched account, 73% say their new current account is better than their old one and only 2% 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%) (Q2 2021 47%)
    • Customer Service (42%) (Q2 2021 39%)
    • Mobile Banking (40%) (Q2 2021 39%)
  • The proportion of current account holders actively considering switching stands at 15% and a further 14% are thinking about it.
  • The Current Account Switch Service’s Confidence Index achieved a score of 80% in Q3 2021 – the second highest score ever recorded. The Confidence Index is the average proportion of CASS users agreeing with each of the following four statements: ‘it would be easy for me to switch’, ‘it would be quick for me to switch’, ‘I think it is a secure and reliable process’, and ‘any problems would be dealt with effectively’..

Q2 2021: Participant performance

Pay.UK publish participant CASS data a quarter in arrears so the latest data provides an insight to switches completed in Q2 2021:

Source: Pay.UK
  • Of the 49 brand participants 10 brands recorded a net gain of accounts (note: a number of brands are included in a catch all ‘low value participant’ category which recorded 531 gains and 936 losses so it is possible that an individual brand or two made a small net gain).

Q2 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. Halifax: +16684
  2. Starling Bank: +13720
  3. Virgin Money: +6915
  4. Monzo Bank Limited: +5707
  5. Lloyds Bank: +3875
  6. Nationwide: +3601
  7. Bank of Scotland: +2946
  8. Triodos Bank: +1128
  9. Co-operative: +787
  10. Danske : +190
  11. Ulster Bank: -140
  12. AIB Group (UK) p.l.c.: -152
  13. Bank of Ireland: -501
  14. Tesco Bank : -1043
  15. Barclays: -3596
  16. RBS: -6188
  17. NatWest: -7451
  18. TSB: -9491
  19. Santander: -11176
  20. HSBC: -16564

Q2 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 usually provides a different picture. However for Q1 the top three by group are unchanged – i.e.

  1. Lloyds Banking Group: +23505
  2. Starling Bank: +13720
  3. Virgin Money: +6915

At the other end of the table the picture is slightly changed by group:

19. Natwest: -13639
20. HSBC: -16564

Conclusion

he 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. This has continued in Q3 with the number of Current Account Switches increasing by 29865 in Q3.

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. Since that time the percentage for small business and charity switchers has fallen back to more historic levels and had reduced to 2% in September 2021.

The top three reasons to switch (online banking, customer service and mobile banking) continue to point to current account providers having a strong digital offering as is evidenced in the league table above.

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 Q3. This is evidenced by the 91% of people who have used the service over the last three years being satisfied with the CASS service.

With 15% of current account holders actively considering switching and a further 14% thinking about switching, the service performance and consumer satisfaction point to the likelihood that 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.