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The Current Account Switching Service (Cass) is seeing an upsurge in account migrations based on service quality, rather than cash incentives, with challenger banks profiting from the trend.
Close to a quarter of a million switches (248,902) took place between October and December 2021. This is 36,302 more than in Q3 2021, and 59,629 more than in Q4 2020.
Nationwide (33,828) had the largest net switching gain in Q3 2021. This was followed by digital-first providers, Starling Bank (15,371) and Monzo Bank (6,498). Santander (4,372) and Virgin Money (3,377) take fourth and fifth place for net switching gains.
While consumer switching trends are typically influenced by the cash incentives offered by individual participants, the latest data for Q4 2021 also shows that service related, non-financial reasons, were the most significant contributors to people favouring their new current account once a switch had been completed.
David Piper, head of service lines at Pay.UK, owner and operator of the Current Account Switch Service, says: “We saw digital-first participants continuing to attract new customers as many seek current account providers with high-quality online tools, such as mobile apps.”
The top reasons cited by switchers included: better online banking facilities (51 per cent), sophisticated mobile or app-based banking systems (41 per cent) and improved customer service (38 per cent). Location of branches (24 per cent) and preferable account fees or charges (23 per cent) followed closely.
Financial Services
