Bank switch bonus

Looking to make some easy money? Then you won’t find much easier than a bank switch bonus. Find out what’s involved and where to look.

There is a lot of money to be made switching banks from a very modest amount of work. According to this article from MoneySavingExpert, one person made £920 from bank account switching alone.

Why do the banks offer the switch incentive?

The current account market has become more competitive over the last few years and it is now far simpler to swap your account. And banks like to think that once you’re with them, you’ll never leave. In turn, this means you will end up giving them lots of money.

Is it complicated to switch your bank account?

Changing your bank account could not be easier.  Thanks to the 7-Day switch guarantee introduced in September 2013, your account could be switched in, errrrr seven days (well, seven working days). The bank does all the hard work including the swapping of direct debits and the moving over of standing orders. In fact, it’s so easy to do, over 3 million accounts have been switched.

Most switches can be completed online and usually take 15 minutes of your time. It’s very rare that you will need to visit your local branch.

How much do you usually earn from a bank switch bonus?

Most accounts will pay in the region of £100-£150 for switching. Sometimes this can be as much as £250, although this usually means staying with the bank for at least six months.

But I like my bank
What if you want to keep your main current account? That’s not a problem, you can switch another account and keep your main one running. If you have an unused current account, then the process will be quite simple.

If you don’t, then it’s time to set up a new account. A sacrificial lamb if you will. Now, your best bet would be a 2nd account from your current provider. Usually, this can all be done online so no need to move from your chair. Awesome. This will normally take up to around two weeks to open. Occasionally the bank may ask for you to provide them with evidence of ID before they open your new account, but I’ve yet to be asked.

Direct Debits
When you have your 2nd bank account ready, it’s time to look at setting up direct debits. Now you may be wondering why you need to do this. To qualify for the bonus, the majority of banks require you to complete the switch with at least two direct debits.

These could be a couple of savings accounts. Although be careful, some accounts take money by standing order rather than direct debit. However, the Post Office offer accounts with a direct debit option. Plus, you can sign up to an app like CHIP, which again, takes money by direct debit.. Again, their accounts can be set up online with little hassle. My direct debits are for £10 each and it’s very easy to transfer the money out of these accounts. Alternatively, you can set up a direct debit with a charity or the Lottery.

If you’ve opened a new account to begin a switch, then wait for the direct debits to become active. This does, of course, depend on the dates you arrange them to be taken out of your account. Once your account is set-up with the direct debits, you’re ready to roll and swap away!
Anything else?

To receive the switching incentive, you usually have to deposit a certain amount of money within a period of time or every month if it is an incentive for staying with the bank. This doesn’t have to be from wages and can be transferred out straight away. However, always check the T&C’s before switching.

And don’t worry, having multiple current accounts isn’t frowned upon.  I have six at the moment and heard of people in double figures!

How much can you make?

Over £1000 in the space of a couple of years is certainly possible. It does depend on when a bank switch bonus is offered, but they usually appear every few months.

Does switching bank affect credit rating?

If you regularly switch your main current account, then it may indicate that you’re not financially stable and less likely to pay off your debts. The best thing to do is to have at least one current account that is several years old. Although, as a regular switcher and having access to my credit report, I have never noticed any adverse effects from switching accounts.

Get switching!

Ready to get started? Find more bank account switching offers I’ve reviewed.

Or take a look at Money Supermarket to see who is offering a bank switch bonus.

Please feel free to ask any questions in the comments below.