Kenishirotie - stock.adobe.com
Surge in UK businesses switching bank account providers
The UK system that makes it easy to change bank account has seen a surge in businesses taking up the service
Twice as many businesses switched bank account provider using the UK’s Current Account Switch Service (Cass) in the second quarter of this year compared to last year.
According to the latest figures from Pay.UK, which operates Cass, 17,687 businesses switched bank account providers, compared to 8,000 in the same three-month period in 2018.
In total, including consumers and businesses, almost six million account switches have taken place on Cass since it was launched in 2013, with almost 247,000 accounts added in the second quarter of this year.
The boost in businesses follows more information being provided about current accounts as well as an advertising campaign aimed at small and medium-sized enterprises (SMEs). The switching service has a 98.9% success rate.
Matthew Hunt, chief operating officer at Pay.UK, said it is very important that businesses as well as consumers realise they can easily change accounts. “It is right that businesses can benefit from competition in this area, and we are committed to providing a switching service that enables this,” he said.
“There can be many benefits gained from switching current accounts and our aim is to continue to ensure that consumers are aware of the options available to them, and to switch providers simply and easily in the event they choose to do so.”
There is increasing choice for businesses, particularly SMEs, when it comes to bank accounts. Challenger banks are taking on traditional banks in the business sector.
For example, Monzo will soon be launching a business account. It began developing a business banking account after a survey of customers revealed this is what they wanted next.
Meanwhile, Starling Bank is expanding its business banking accounts to larger SMEs, after it launched its mobile business bank account for single-person businesses, initially.
Cass was introduced by the Banking Commission in 2013. It is designed to simplify and speed up the process of changing bank account providers for consumers, small businesses and charities.
Vocalink built the service’s IT platform, with IT services company CGI overseeing the overall project. The two-year project cost £750m, including central IT changes and those of participants as well as marketing.
Read more about seven-day switching service
- Payment Council figures on the number of consumers who switched accounts could indicate the beginning of a new era in UK retail banking.
- The IT system that underpins government’s regulation of seven-day bank account switching is underused.
- Current account holders in the UK can now switch banks within seven days following the launch of Cass.