Many banks and building societies currently pay savers to switch to them with offers including £200 from Lloyds bank. New customers often have to deposit a certain amount to claim the cash.
The Lloyds Bank offer works in a different way as a person has to switch to a packaged amount.
The £200 bonus also has to go towards the bank’s travel, breakdown and mobile insurance, which lasts for 20 months.
To access a switching bonus, a person will need to close and switch their current account using the Current Account Switch Service (CASS).
The service promises to complete the transfer within seven days with all the funds and arrangements usually moved over automatically.
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This includes the balance of the account and any direct debits and salary. The service is also free to use.
People may also have other terms and conditions to comply with to do the switch, such as depositing a certain amount in the new account each month.
Once all the CASS has been completed, the switching bonus usually arrives in a person’s account within a few weeks.
Savers may want to note recurring payments from a bank or building society card are not moved over using CASS.
These transactions are known as “continuous payment authorities” and are set up using a person’s debit or credit card details, rather than their account number and sort code.
People commonly set up these payments for memberships and online subscriptions, so they may be in place for an account that a person wants to switch from.
In this case, a person will need to give their new card details to any companies that take regular payments from them in this way.
Savers may want to look at switching their bank account at the moment, as interest rates have increased on many accounts over the past year. The base interest rate, as set by the Bank of England, is currently at four percent.
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