Last updated Apr. 15, 2025 by Charles Zemub
Deciding to close your bank account can be influenced by multiple factors such as high fees, poor customer service, or better offers elsewhere. This process, while seemingly simple, involves several steps to ensure a smooth transition to a new bank. This guide will walk you through the necessary steps to close a bank account and switch banks in the UK effectively.
Why Switch Banks?
Switching banks can be beneficial for various reasons:
- Lower Fees: Some banks offer lower charges for account maintenance, transfers, or international transactions.
- Better Interest Rates: Switching can mean better savings rates, helping grow your savings faster.
- Enhanced Services: Features such as mobile banking, better customer service, and enhanced online security can be persuasive factors.
- Incentives: Some banks offer cash incentives and other perks for new customers.
Preparing to Switch Banks
Before you close your bank account, follow these preparatory steps:
1. Research and Compare Banks
Start by identifying what you need from a new bank. Consider factors like interest rates, fees, accessibility, and customer support. Websites like MoneySuperMarket, Which?, and CompareTheMarket can help you compare different banks.
2. Open a New Bank Account
Once you have chosen a bank that meets your needs, proceed to open an account. This can often be done online or via a mobile app. Make sure your new account is fully operational before closing your old one.
3. List Regular Payments
Make a list of all standing orders, direct debits, and regular payments so you can ensure they are transferred to your new bank account. Neglecting this can lead to missed payments and potential service disruptions.
4. Ensure Sufficient Funds
Keep an eye on your old account to ensure there’s enough money to cover any pending payments as your account transitions.
Closing the Old Account
After setting up a new account, the following steps will help you close the old one:
1. Transfer Funds to the New Account
Move all available funds from your old account to the new one. Double-check to make sure no incoming payments are lost in transition.
2. Transfer Regular Payments
Contact your service providers to update your banking details, or use the Current Account Switch Service (CASS) for transferring your direct debits and standing orders. CASS is a free service that makes switching banks seamless, transferring all regular payments and ensuring all incoming earnings are directed to the new account.
3. Cancel Overdrafts
If your old account has an overdraft, contact your bank to discuss how you’d wish to pay it off. Ensure this is settled before closing the account, as this can impact your credit rating.
4. Settle Outstanding Transactions
Resolve all pending transactions and ensure any remaining cheques have cleared before initiating account closure.
5. Formally Close the Account
Visit your old bank or initiate a request online to formally close your account. You’ll need identification, and you may want to request a confirmation letter from the bank verifying the account closure.
Using the Current Account Switch Service
The Current Account Switch Service (CASS) is a tool available in the UK to facilitate bank switching. Here’s how it helps:
- Free Service: It simplifies the process by moving your balance, salary, direct debits, and standing orders for free within seven working days.
- Guarantee: The service guarantees that any issues arising from the switch will be resolved at no cost to you, preventing you from incurring additional charges.
- Automatic Forwarding: Any payments made to the old account are automatically redirected to your new account.
Utilizing CASS makes the switching process virtually hassle-free, significantly reducing the burden on the account holder.
Final Considerations
After closing the old account, regularly review your new account to ensure all expected transactions occur as planned. Contact your new bank for any assistance regarding the transition.
✓ Short Answer
To close a bank account in the UK, transfer your balance, update direct debits, and clear outstanding fees. Ensure your new account is working before closure. Use the Current Account Switch Service to streamline this process by transferring payments and handling future transactions with your new bank. Finally, formalize the closure through your old bank, ensuring there are no pending transactions or overdrafts.
FAQs
Q: How long does it take to switch banks?
A: Using CASS, switching banks typically takes seven working days.
Q: Are there fees for closing a bank account?
A: Most banks do not charge for account closure, but ensure you’ve dealt with any outstanding overdrafts which might incur costs.
Q: What happens to my direct debits?
A: Direct debits can be transferred using CASS, which ensures all your payment setups move to your new bank automatically.
Q: Can I switch banks if I have an overdraft?
A: Yes, but you should discuss this with your bank and arrange to settle or transfer the overdraft to avoid any disruptions.
Q: What happens if there are payments made to my old bank account after I switch?
A: With CASS, payments made to your old account will be automatically redirected to your new one for a time after the switch.
By following these steps and using available resources like CASS, you can successfully close your old bank account and switch to a bank that better meets your financial needs.
