This September I'll get sweet revenge on my bank

Current accounts are expected to transform into a window shopper’s dream come true.

Come September and current accounts are expected to transform into a window shopper’s dream come true. Thanks to the Vickers report, customers will be able to switch current accounts, and thus banks, within seven days as opposed to the 30 arduous ones it generally takes.

For someone like me this comes as sweet revenge as I will never get back the endless hours that I have lost over the phone with bank customer care executives - that have made me feel like I am speaking in Hebrew (even though I have clearly been trying to explain an unfair fee or charge) – only to hear what starts and stops at "sorry we cannot help".

Yes September will be a game changer and there has been no dearth of surveys, reports, white papers and webinars saying exactly that. Perhaps the fast switch option will shake up the UK’s Big Five especially (Lloyds, RBS, Barclays, HSBC, Santander – in that order) that currently hold over 80 per cent of the current account market. It will also question the basic fabric of customer loyalty and reveal what customers really want and go for.

However, the question that has often struck me, is, will banks really make it that easy? Apparently so.

The Payments Council has gone a big step closer to that September deadline now by unveiling a trustmark and guarantee that will outline customers' rights. What’s more, all major providers have signed up for it, although not compulsory.

Some of the key points that The Payments Council has outlined are - the new provider will take care of switching regular payments going out such as direct debits, and salary payments coming in; for 13 months payments accidently sent to the old account will be automatically redirected to the new account; and if something goes wrong with the switch, any lost interest or charges that result will be refunded. Golden words!  

The fact that banks will take responsibility if something goes wrong and have agreed to help the customer, as well as each other, through the switching process is a huge relief.

According to a Moneysupermarket survey, a whopping 75 per cent of Britons have never switched their current account. Not necessarily because they’ve been happy with their banks.

Research undertaken in 2012 by Moneysupermarket exposed that 72 per cent respondents had been with their banks for over 10 years, and 32 per cent said the only reason they did not switch current accounts, despite wanting to, was the "hassle" involved with the process.

There have been temptations to switch banks – sure – the Santander 123 Current Account (3 per cent interest and cashback paid every month), the first direct 1st account (£100 cashback offer), the M&S Premium Current Account (£100 M&S gift card and 20 per cent off on shopping once a month for a year), and then the regular lures of such as potentially earning interest on the balances or a fee-free overdrafts. But the deterrent generally is the idea that banks will make the switching process an inefficient nightmare.

A friend of mine who has switched his current account a few times now (wont he be happy in September!) says he had to overlook the switching process himself instead of the banks facilitating the changes or making them smooth.

However, customers knowing that the onus is on the banks, come September, to do all the work, while they just pick a lender, a date, and instruct, is a big step forward in confidence building – especially for those who have been with their banks for years and gotten used to the problems that have cropped up along the way.

Survey results published in April 2013 by Which? revealed that a fifth of customers who made a complaint to their banks felt it was not resolved satisfactorily. There were as many as 323,000 complaints about current accounts reported to the Financial Conduct Authority only in the first half of 2012.

With 1.2 million people switching current accounts in 2012, a record numbers of people are expected to bid adieu to their banks in 2013.

As customers gear up to take the leap and make friends with new current accounts providers, the key hope The Payments Council’s guidelines have sparked is not just around current account design, innovation, offers, but actually banks getting along with each other, and helping customers switch with better coordination and ease.

Revenge, as they say, is best served with an easy and fast switch.

Photograph: Getty Images

Meghna Mukerjee is a reporter at Retail Banker International

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4 ways to end freedom of movement (and try to dodge a hard Brexit)

A lot depends on the details. 

There are few subjects as explosive in Britain today as immigration. Labour is split between those who see anti-immigrant feeling as racism by stealth, and those who consider it a legitimate response to a changing labour market. The Tories, too, are divided between social conservatives worried about culture and communities, and economic liberals who believe everything must be done to preserve the single market.

If David Cameron hadn’t decided to hold an EU referendum, perhaps this debate would have rumbled on before either rolling towards an overwhelming question or being outstripped by events. But he did, and Brexit happened. 

Now, most political realists agree, there will have to be some kind of policy change on immigration. But apart from turning the lights out at border control and bracing ourselves for a hard Brexit, what are the options? Here are some of the ideas on the table:

1. A points-based system

This idea has been bandied around for years, with “points-based system” usually coming straight after “Australian”. The principle is simple enough – aspiring immigrants gain points depending on their education, age, fluency in English and work experience. Of course, the Australian immigration system also involves refusing to let desperate people on boats land, and instead leaving them to rot on islands like Nauru. However, the points-based system is also used in Canada, and *news klaxon* the UK already uses elements of a points-based system for immigration from outside the EU. 

If you’re Theresa May, the main argument against a points-based system is, apparently, that it lets in too many talented immigrants. If you’re the NHS, it can be an obstacle to hiring staff who are desperately needed. And if you’re a Brexit negotiator, since a points-based system effectively eliminates working-class EU immigrants, it is going to make your job very hard indeed.

2. Regional recruitment

In Canada, each province can set their own immigration policy, within certain boundaries, by nominating individuals for permanent residence. So British Columbia is willing to nominate healthcare professionals and post-graduate students who attend a provincial university. The Yukon, a remote province with just one city, nominates entrepreneurs.

But there’s the thing. Canada is the second biggest country in the world, and the population is half that of the UK. Breaking the rules takes effort. Chris Murray, a research fellow at the IPPR, said: “Everyone’s afraid it is a backdoor to London. You say you’re working in Cumbria, and you move straight down to London.”

3. An emergency brake

Back in 2014, the then-Prime Minister David Cameron floated the idea of an “emergency brake” on EU immigration. Under this system, which is based on existing EU law, free movement could continue but the Government would reserve the right to halt it in certain circumstances. As the FT noted: “The rules are supposed to deal with situations such as acts of war or volcanic eruptions, not the movement of fruit pickers from eastern Europe.”

After the volcanic eruption of Brexit, though, the IPPR now thinks an emergency brake could be Britain’s best bet. Murray told The Staggers: “It is quite targeted, and also it is much more likely to get support from European partners.” But remember, Cameron tried to negotiate an emergency brake before. And failed. 

4. Work permits

If you subscribe to the idea Brexit was about wages, and not xenophobia, you might be inclined to support a system of work permits. Under this system, freedom of movement could continue for students, families and retirees, but workers would have to obtain work permits. Home secretary Amber Rudd has said of the idea that it “has value”. 

The problem is, both Britain’s Brexiteers and the EU’s negotiators can count. Hand out work permits to everyone, and immigration levels remain high. Tighten the rules, and that’s the end of freedom of movement. It’s hard to see either side giving the Government such an easy way out.