Nationwide dominates bank switching battle with help of cash bonuses and Fairer Share lure

Nationwide Leads in Current Account Switching, Fueled by Incentives

New data indicates that Nationwide continues to triumph in the competitive landscape of current account switching, largely propelled by appealing cash incentives for customers initiating a transfer. This analysis delves into the latest trends in bank switching and the impact of financial incentives.

Over the past year, more than 1 million bank account switches occurred, with 222,805 of these transitions taking place in the first quarter of the year, according to figures released by the Current Account Switch Service (Cass).

Britain’s largest building society, Nationwide, emerged as the frontrunner, recording the highest net switching gains with 51,254 new customers between October and December 2024. These bank-specific figures are reported with a three-month delay.

Lloyds Bank followed closely, securing 50,061 net switchers during the same period.

This marks the second consecutive quarter that Nationwide has achieved the highest net switching gains. From July to September 2024, Nationwide reported net gains of 22,622 switchers.

Previously, changing banks was a complicated procedure involving manual adjustments to direct debits, payments, and notifying employers of new account details.

Cass, introduced in 2013, automates these processes, enabling customers to switch their current accounts online with a guarantee of compensation if any issues arise.

Any payments mistakenly directed to the old account are automatically redirected, and the entire switching process is designed to be completed within seven days.

These switching statistics, which denote the second successive year of over a million switches, occur amidst fluctuating economic conditions.

John Dentry of Pay.UK, the operator of Cass, noted, “The past quarter has presented a dynamic economic backdrop, undoubtedly motivating increasingly budget-conscious consumers to take action.”

These figures also coincide with generous switching bonuses offered by both Nationwide and Lloyds.

From October to December 2024, Lloyds provided a £200 cash bonus to new current account holders, while Nationwide offered £175 until March 31, 2025.

Nationwide also distributed a highly anticipated £100 “fairer share” payment last summer, indicating a potential repeat of the payment this year.

This initiative likely attracted new current account customers hoping to secure both the potential £100 bonus announcement and the £175 switching incentive.

Andrew Hagger, director of MoneyComms, a personal finance website, commented, “The Fairer Share payments from Nationwide Building Society are undoubtedly an additional attraction and a potential reason to remain with the society.”

“Lloyds Bank’s figures show 79,004 gains and 28,943 outgoing switches, resulting in a net gain of 50,061 switchers. Had the bank paid £200 for each of the 79,004 gains, it would have spent £15.8 million to acquire those new customers.”

Mr. Hagger posits that the data “demonstrates the influential power of cash incentives in persuading customers to switch banks.”

Switching incentives represent an expensive method for banks to attract new customers, specifically given that some account holders may transfer again within a few months if another bank offers a better cash bonus.

The data encompasses cumulative switching data for five years ending December 31, 2024, revealing that Nationwide and NatWest have been the most successful at attracting new clients, while Barclays ranks lowest in the switching league tables.

Between October and December 2024, Barclays experienced net losses of 37,128 customers, acquiring just 3,759 new customers while losing 40,887.

Current Bank Switching Incentives

Switching banks can be an effective method to earn extra cash, as confirmed by recent switching data.

Currently, only two banks are actively promoting switching incentives:

• First Direct offers £175 to new 1st Account customers.
• NatWest provides £150 to those switching to its Reward current account, which includes a £2 monthly fee and offers benefits like 1 percent cashback on selected retailers.