A guide to switching current accounts

If you have had your current account for a few years, you might be casting envious glances at some of the deals offered by other banks and building societies. While many customers are put off switching their bank account by the potential hassles associated with such a move, switching your account in order to get a more favourable interest rate, better facilities or lower charges is easier than you might think. The balance can be transferred from your old account to your new one within a day, and all that you need to do is present your ID, fill out a few forms, and change all your direct debits to the new account.  

If you are overdrawn, you might think that would rule you out of a current account switch, but this is not always the case. As long as you have a reasonable credit history, you shouldn’t find it very difficult to find a bank that is willing to take on your overdraft. After, banks make lots of money out of overdrafts, and as a result are very keen to give them to people who can be trusted with them. If you are currently paying a high rate of interest on your overdraft, or have to contend with very high charges for going slightly over your limit every now and then, then switching your current account could save you a lot of money. 

Most current accounts pay a very low rate of interest on positive balances, often much lower than the rate of inflation. However, there are some current accounts out there, such as the Preferred In-Credit Rate Account from Santander, that give credit interest rates that wouldn’t be out of place in a savings account. By switching your current account to an account with a higher rate of credit interest, you can make your money work harder for you while it is in the bank. Have a look at the Santander site for more on current accounts. 

You may find that you can get better deals if you choose a current account with an internet-only bank. These are a good option if you do not anticipate having to deposit cash or cheques into your account, as this would usually require a trip to your local branch. However, there is nothing to stop you from having your main current account with an internet bank, and a secondary account with one of the high street banks that you can use for making deposits.

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