What is the 7-day Current Account Switch Service?

Switching bank account is easy thanks to the 7-day Current Account Switch Service. The scheme guarantees that you can move banking providers within 7 working days.

So, how does the 7-day bank switch service work? And what are the benefits of using it? Let’s take a look.

What is the 7-day Current Account Switch Service?

The Government launched the 7-day Current Account Switch Service back in 2013 to make it easier for consumers to move bank accounts. Under the scheme you have a right to expect any bank switch to take a maximum of 7 working days. Plus, the scheme also guarantees any payments, including regular payments—such as direct debits—are automatically transfered over to your new account after switching.

These guarantees mean there's no need to worry about missing payments coming in or out of your old account as this is all taken care of. If any mistakes happen, you're covered.

In addition, when switching banks, your old account is automatically closed for you. This means you don't have to inform your old bank you're leaving.

Why was the 7-day Current Account Switch Service needed?

Prior to the launch of the Current Account Switch Service, switching bank accounts may not have been worth the hassle. That's because if you had any important payments coming in or out of your old account—including mortgage payments—you had to manually go through the trouble of setting up new payments on your new account.

Plus, if anything went wrong, you would be considered at fault. This could have been a major problem if you moved bank accounts and forgot to inform your employer. That's because your salary may have ended up being paid into your old account.

Because of these risks, low switching numbers in general, and an independent report suggesting bank switching should be made easier, the Government clearly felt something had to be done. As a result the Current Account Switch Service was introduced in 2013. The move was generally welcomed by consumer groups.

As well as making it easier to switch bank accounts, it was also hoped the guarantee would lead to greater competition among providers, and improve levels of customer service.

What should you be aware of when it comes to switching bank accounts?

There are two big things to be aware of when it comes to using the 7-day switch service.

1. You will have to activate & set up your debit card

When you switch bank accounts you must activate your new debit card and set up a new PIN. Any PIN you had set up on your old debit card won't be transferred over to your new card.

Also, while your new account will be switched with 7 working days, this rule doesn't apply to debit cards. This means you could be waiting for your debt card to arrive in the post, even after your new account has been set up.

2. You may not be able to switch immediately

The 7-day switch guarantee only applies once you've selected a switch date. This means that it could take more than 7 working days to move your account if there isn't a switch date available within 7 days.

What does the bank switch service cover you for?

The 7-day bank switch service guarantees payments to and from your old account will be automatically redirected to your new bank account. This includes regular payments, including any direct debits or standing orders you have set up.

However, under the 7-day switch service, payments only have to be redirected for a maximum of three years. While some banks will be happy to redirect old payments for a longer period, it is worth taking the time to manually change over old payments within three years to ensure you avoid any hiccups.

Importantly, if anything goes wrong with your switch, your new bank will cover you for any losses. This may include interest payments, or fees you have been charged as a direct result of any mistake.

Which banks are part of the bank switch guarantee?

The Current Account Switch Service doesn't apply to all banks. So if you want to switch to an account that isn't part of the service, you'll have to move accounts manually. Thankfully, most banks are part of the service.

It's usually easy to know if a provider is part of the service by looking out for a 'Current Account Switch Service' (CASS) logo on its website. However, if you're unsure, you can use the tool on the CASS website.

How do you use the 7-day bank switch guarantee?

If you want to take advantage of the 7-day switch service the easiest way to do so is to inform your new provider when opening a new account. For example, if you wish to move from Barclays to Halifax, you can apply for a new bank account on the Halifax website. During this process, you'll be asked whether you want to switch bank accounts. At this point, there is usually a box you can tick to indicate that you do wish to switch accounts.

Once you've selected this option, your new provider (Halifax in our example) will ask for your Barclays sort code and account number.

While it's often easiest to switch at the same time as applying for a new account, you don't have to. Some providers will happily allow you to switch into an existing account.

Can switching bank account impact your credit score?

When applying for a new bank account, you'll either undergo a hard or soft credit search. This applies regardless of whether you plan to switch accounts.

'Soft' searches aren't visible to other companies, so these won't impact your credit score at all. However 'hard' searches are recorded on your credit file. However, hard credit searches aren't something to be overly worried about as they're usually removed from your credit file after six months or so. In the short term however, lots of hard searches could have a negative impact on your ability to obtain future credit.

So, if you're planning to make an application for credit in the near future, you may wish to hold off opening a bank account that requires a hard search.

Does the Current Account Switch Service only apply to bank accounts?

Yes, the switch service only applies to bank accounts. It does not apply to savings accounts, mortgages, or any other personal finance product.

Can you switch banks if you're overdrawn?

Yes you can, though this will depend on your new bank. If you do manage to switch while overdrawn, your negative balance will move over to your new bank.

Ready to switch bank accounts?

If you've had enough of your existing bank and you're keen to switch, take a look at our comprehensive guide to the best bank accounts available right now. Switch today and you could bag yourself a juicy bonus worth up to £200.