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“New switching figures hint at a big bank backlash”

01 August 2014

Gocompare.com’s banking expert comments on The Payments Council’s latest current account switching data which reveal the winners and losers in the first three months of the switching guarantee scheme

Matt Sanders, Gocompare.com’s banking expert, said: “These figures make interesting reading and it’s clear that customers have been enticed by incentives and cash back deals. The figures show that the biggest winners are Santander with its 123 account, which offers varying amounts of cashback, and Halifax with its £100 payment for those who switched to its Reward account, as well as the £5 per month in credit incentive.

“These new switching figures hint at a big bank backlash with the main four high street banks having seen thousands of customers defect. The reputation of banking in general has been tarnished by several mis-selling scandals and troubles at the beleaguered Co-op bank seem to have triggered a significant customer revolt. The old guard banks really need to work on their reputation as well as their products if they want to regain customer trust.

“With switching bank accounts now much easier it will be very interesting to see what happens in the coming months, as new entrants to the sector emerge. Several supermarket chains have started offering current accounts and Virgin Money recently launched its new Essential current account in Scotland and Northern Ireland. These challengers could provoke a big shift in the whole banking sector, as they may be able to offer more innovative and convenient products to customers looking for a better service from more trusted brands.”