The UK's Competition and Markets Authority has welcomed a commitment from the nation's banks to overhaul the Current Account Switch Service (Cass)to ease the issues facing customers who want to move bank accounts.
An important change will be an increased redirection period for payments made to an old account designed to give further assurance to customers that all their payments will be switched from their old account to their new one, and so overcome a key concern about moving banks.
At the moment only three percent of personal and four percent of business customers switch to a different bank in any year, even though consumers could typically save £92 per year by moving to a new provider. Small firms could realise savings of around £80 a year on average.
Alasdair Smith, chair of the CMA retail banking market investigation, says: "Switching is the key way for people and small firms to find better banking deals and save money. Improvements to the switching service will give customers better information about, and so greater control over, their finances. This in turn will make it easier to move their money and capitalise on better offers."
Bacs, which runs the switching scheme, has also been tasked by the CMA to work with banks to target those likely to benefit from switching the most, such as overdraft users and customers with high credit balances, and make sure they know other options are available to them.
Previously run by the banks it represents, Cass now has an independent chair in place with a mandate to gather input from consumer groups and price comparison Websites on how the service operates and promotes itself.