It’s been 12 months since the Current Account Switch Service was launched and the Payments Council has delivered its latest figures on the number of transactions.

Since its launch 1.1 million customers have ditched their existing bank and switched accounts.

This is an increase of 19% compared with the same period a year before, when 925,985 switches took place.

The switching process is becoming more popular, partly because customers say it has been a painless experience. Nine out of ten consumers who have switched felt that there was very little effort involved on their part, while the same number said it was quick and the process went without a hitch.

Awareness of the service has also increased, with 70% of the public now aware of it and 61% are confident about what the new service involves and how it works.

It seems to be working well, with the service having cut the time it takes to switch bank accounts to just seven working days or less, when previously customers would have been waiting for between two and for weeks.

A spokesman for the Payments Council commented: “The service was designed to make life easier for customers by removing barriers to switching, with the aim of boosting competition in the banking sector. It’s clear from reviewing its very first year that it’s made great ground – empowering customers with the ability to switch their bank account easily and quickly if they choose to do so.”

 

Despite a much improved economic situation in the UK, over a third of people feel that their finances have not improved in the last 12 months.

According to research by VoucherCodes.co.uk two out of three Brits find their ever increasing utility bills a source of financial stress as well as seeing their budgets stretched to cover the rising cost of food.

Three quarters have adopted money-saving techniques in the past 12 months, with women appearing to be the most financially savvy. While women were more likely to adapt their lifestyles to suit their budgets – 42 per cent of women changed their shopping habits to cheaper alternatives, compared to just 28 per cent of men.

The report revealed men were much more likely to take out additional finance to maintain their standards of living. Some 42 per cent of men said they had borrowed money compared to just 28 per cent of women.

Almost half of people have increased their credit card borrowing, while 30 per cent owe money to the bank and just under a quarter are repaying a loan company.

A spokesman for VoucherCodes, said: “As we head into the winter months it seems the summer season has left Brits feeling the pinch. It’s clear the debt problem isn’t going away any time soon, but there are lots of resources available with advice on everything from budgeting to switching utility providers to help householders get back in the black.”

Mortgage rates have been falling quite sharply with at least half a dozen lenders unveiling rate cuts and fee reductions in the last two months.

Halifax, Nationwide, Virgin, Woolwich and Skipton have all cut rates, while others including Santander and HSBC have done away with some of their fees.

Lenders are also throwing in extra freebies including free valuations and legal costs.

A spokesperson for mortgage broker London & Country put the rate cuts down to a combination of factors. The first is that ‘swap rates’ – borrowing costs banks factor in their fixed-rate mortgage pricing – have been falling.

Mortgage lenders are keen to stay competitive and attract new customers so they are passing on the reduction in costs with cheaper home loan deals.

The second reason is that lenders have now had almost six months to get to grips with new tougher lending criteria after the introduction of the Mortgage Market Review back in March and are now getting back to business as usual.

The final factor is that we’re getting in to the autumn, one of the busiest times in the property market so lenders are cutting their rates to woo new customers and meet the year end targets which run to the end of December.