Three switching offers launched within last two weeks

Competition between banks for new customers has reignited this month, as three new switching offers have been launched within the space of two weeks.

After a slow start to 2021 that saw little competition between banks for new customers, HSBC, Virgin Money and first direct have all introduced new switching offers over the last few weeks that allow customers to gain cashback or a reward for changing their bank account. “A battle for banking customers may have finally started in 2021 as some current account providers have launched enticing switching offers over the past month,” revealed Rachel Springall, finance expert at Moneyfacts.co.uk. “Traditionally we would see tantalising offers nearer the start of the year, but the impact of the Coronavirus has perhaps delayed any plans to entice new business as providers concentrate their efforts on their existing customers instead.”

HSBC was the first to launch an offer – on the 9 February, it introduced its switching offer that allows consumers to earn £125 when they switch to an advance or premier bank account. In order to receive £125, customers must switch a minimum of two direct debits or standing orders to the new accounts using the Current Account Switching Service (CASS) within 30 days of account opening*.

On the 15 February, Virgin Money added an incentive that enables those who switch to Virgin Money using the CASS to receive a free luxury 12 bottle case of wine from Virgin Wines, which is worth £138. As well as this, the incentive offers switching customers £50 from Virgin Money to donate to any Virgin Money Giving charity. Alternatively, customers can choose to receive 15,000 Virgin Red points although they should be aware if they choose this option they cannot receive the wine and charity donation offer. In order to receive these incentives, customers must set up two direct debits, register for the mobile app, deposit at least £1,000 into a linked savings account within 31 days of account opening and close their original account*.

Last week on the 17 February, first direct also launched a switching offer that enables customers to receive £100 when they switch to a 1st Account using the CASS and deposit a minimum of £1,000 into the account within three months*.

“Consumers may feel like there is little incentive to switch right now, but it is always worth reviewing their current account to see if it is working hard enough for them,” Springall said. “The landscape for current accounts has changed immensely over the past year, with offers withdrawn, interest rates cut and overdraft flat fees abolished. Banking customers may find that they could get a better deal by switching, but the best account for them does depend on how they spend or save.”

She added: “It is too soon to tell whether we will see any more switching offers launch in the weeks to come, as providers may still be assessing their ranges in light of the Coronavirus pandemic. Whatever consumers decide to do, switching by using the CASS is worth contemplating but they must be sure any account suits their overall banking needs and not to be swayed by a perk alone.”

For more information about changing bank accounts read our guide on how to switch current accounts. 

*other terms and conditions may apply.