The allure of switching bank accounts for a financial incentive can be strong, but the associated paperwork and logistical issues often deter many. For years, I contemplated the idea of frequently switching banks but hesitated out of concern about how my employers might perceive my constant changes in banking details.
Then, during last Christmas, I decided to take the plunge and encouraged my partner to join in. Initially hesitant about the disruption for what seemed like minimal financial gain amid our hefty childcare expenses in London, she eventually came around after some convincing — “Imagine something you’d love to buy for yourself with this money,” I suggested.
The Current Account Switch Service streamlines the process, allowing transfers in as little as seven days. I figured by making five switches, we could earn over £800 each. I envisioned joining a local tennis club, while she dreamed of flying her mother over from Canada. We were in!
Our Switching Journey
I opened a secondary account to qualify for switching bonuses, ensuring I maintained my primary account for daily transactions. This allowed me to fulfill the necessary criteria to earn bonuses while keeping my regular banking intact.
We moved two direct debits each to our new accounts and initiated our first switch with Nationwide, which offered a £200 bonus. To qualify, I had to close my old account and ensure the direct debits remained active. The app setup required some biometric security checks, taking about two hours as I sifted through the mail for necessary codes. So far, manageable.
As I proceeded, I was mindful of potential impacts on my credit score since opening new accounts entails credit checks. An over-application for credit can negatively influence your report. Given we had no significant financial moves planned, I decided to proceed without concern.
Following Nationwide’s successful switch, we continued with banks like NatWest, Santander, and Barclays. I started researching tennis clubs to join.
However, conditions for earning bonuses became increasingly complex. NatWest required me to deposit £1,300 overnight, while Santander mandated the account stayed open for 60 days before the bonus was issued. Still, when the bonus appeared in the Santander app, I contemplated if it was worth switching just for aesthetics.
Continuing with Barclays proved fruitful despite requiring a monthly fee for their rewards scheme. Banks often attached additional conditions to earning bonuses, including limited-time offers. I even received an offer for a sports streaming pass, but my focus remained on tennis.
After about a month, I received a text: “Hi Rick, great news. You’ll receive your £175 bonus shortly.” My birthday passed without getting my tennis racket out, and my wife’s mother remained in Canada.
The challenges escalated. Lloyds required at least three direct debits, while TSB needed five purchases in the first month and continued spendings to earn additional cashback. While one could theoretically buy 20 bananas in a month, I found such antics cumbersome. This was far from the effortless experience I initially anticipated. The banks seemed to be tightening their criteria.
Remarkably, switching banks became increasingly popular; last year, the switch service recorded the transfer of 1.4 million accounts, reflecting a 10% increase from the previous year. Although 99.7% of switches were completed within seven working days, bonus arrival times often varied.
Ultimately, after nine months, we reached our goal, each securing £825 from five successful switches. My partner’s mom successfully visited from Canada without knowing her trip stemmed from our banking endeavors.
While each switch took under two hours, that timeframe excluded waiting, following up, and fulfilling various spending conditions. By the end, we had exhausted most offers, as banks typically limit bonus eligibility to accounts opened in the last three years.
Was the effort justified? Perhaps.
However, the hassle involved makes me question if I’d opt for this route again. Hopefully, my new tennis club acquaintances might suggest better ways to earn cash without so much trouble.
Tips for Successful Bank Switching
• Identify an account. Use comparison websites to find accounts offering switching bonuses. Assess the banks’ reviews for factors like customer service and app usability.
• Review the terms. Bonuses often require a minimum deposit and specific direct debits. Previous customers may not qualify, so check beforehand.
• Submit your application. To switch, contact your new bank, providing personal details including your previous account information.
• Initiate the switch. Once approved, choose a switching date, activating your new account and transferring payments from the old one; this can take as little as seven days.
• Await your bonus. Confirm with your new bank about the bonus timeline and any ongoing conditions for qualification, such as monthly spending.