Bank Switching Bonuses: How to Get Paid to Move

Banks compete hard for current account customers, and one of their main weapons is a straight cash bonus for switching. The switching process itself is genuinely automated and guaranteed, which makes this one of the few offers in personal finance that is close to free money.

How the switch actually works

The Current Account Switch Service is an industry-wide system used by the great majority of UK banks and building societies. Once you apply:

• The new bank moves your balance, direct debits and standing orders.
• Payments sent to your old account are redirected to the new one.
• Your old account is closed.
• The whole thing completes in seven working days on a date you choose.

It comes with a guarantee: if anything goes wrong and you are left out of pocket through charges or interest, the banks put it right. You do not contact anyone yourself — the new bank does the work.

Reading the conditions properly

This is where the money is won or lost. Typical conditions include:

• A full switch using the switch service. Simply opening an account and moving money across by hand almost never qualifies.
• A minimum number of direct debits transferred — often two or three. Check whether standing orders count; frequently they do not.
• A minimum deposit within a set window.
• Registering for online or mobile banking, and sometimes logging in at least once.
• Not having held an account with that bank, or received a previous bonus from them, within a stated period.

Miss any one and the bonus does not arrive. Read the terms twice, then note the deadlines in your calendar.

Look past the headline bonus

A one-off payment is nice, but you may hold the account for years. Weigh it against what the account does day to day:

• Interest on the balance or linked regular saver rates, which can outweigh a modest bonus over time.
• Overdraft charges if you ever use one.
• Fees abroad for spending and cash withdrawals.
• Monthly fees on packaged accounts, and whether the insurance bundled in is something you would otherwise buy.
• Branch access if you need to pay in cash or want in-person service.
• App quality and customer service, which you will live with daily.

Things to check before you apply

Your credit file

Opening a current account normally involves a credit check that leaves a hard search. One or two are unremarkable. Several in a short period can make lenders wary, so avoid switching in the months before applying for a mortgage.

Overdrafts do not transfer automatically

If you use an overdraft, the new bank must agree to give you one, and it may be smaller or not offered at all. Sort that out before switching, not after.

Anything linked to the old account

The switch service handles direct debits and standing orders, but recurring card payments — subscriptions billed to your debit card — are not direct debits and may not move. Make a list of them and update the card details yourself.

Tax and the bonus

Switching bonuses are generally treated as taxable income rather than savings interest, though the treatment can depend on how the bank structures it. For most people the amounts are small enough not to matter, but if you are near a tax threshold it is worth checking your position.

Can you do it more than once?

Yes. Some people switch repeatedly as new offers appear. If you go down that route:

• Keep one long-standing main account and switch a secondary one, so your everyday banking is never disrupted.
• Keep a small set of direct debits that can travel with the switched account.
• Space applications out to limit credit searches.
• Keep a record of which banks you have already claimed from, since most exclude repeat claimants.

A note of caution

Do not choose a bank you will dislike using for the sake of a one-off payment. And never switch an account that has essential payments running through it without checking the timing — give yourself room around payday, rent and mortgage dates.

Offers appear and vanish constantly, and terms change. Always check the current conditions on the bank’s own site before applying.