Transferring business accounts between banks
How to switch banks successfully
Some businesses are reluctant to switch banks because they fear the process could be time-consuming and possibly disruptive.
However, subscribers to the Banking Conduct of Business Sourcebook (BCOBS) - which replaced the Business Banking Code on 1 November 2009 - have committed to making the transfer of bank accounts quicker and simpler for their customers. Find the BCOBS on the Financial Services Authority (FSA) website - Opens in a new window.
For example, your old bank has to send details of your direct debits and standing orders to you and your new bank within three days of a request to do so. Your new bank must then set up these payments and inform the recipients of your direct debits within four working days. If they fail to fulfil their commitments you may be entitled to a payment from the bank concerned.
How you can smooth the process:
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Contact your new bank and obtain application forms. Check the terms and conditions of the new account carefully. Discuss any concerns you have before returning the forms.
- Have information about your business readily available for the new bank, including which individuals will have access to the account. They'll check this information and then let you know if your application has been successful.
- Complete the mandate from your new bank. This allows them to deal with your old bank on your behalf and request details of regular payments.
- The new bank will arrange for these payments to be switched. Those who make payments will need to be notified of the new account details. Check whether the bank will notify them, or whether you should do this.
- Keep monitoring both accounts carefully to check for irregularities, such as payments being made twice.
- If possible, keep your old account running until you're sure the new bank can deliver the service you require.
- Check the BCOBS for information on standards that apply to banks when transferring accounts. Find the BCOBS on the FSA website - Opens in a new window.
The new bank will notify you once they're satisfied they've completed their responsibilities for the switch.
If you are unhappy with the service you have received from your bank in the first instance complain to your bank. If you remain unhappy, you can find out about complaining or resolving a dispute with your bank on the Financial Ombudsman website - Opens in a new window. However, please note that the ombudsman is only able to assist small businesses with less than £1 million annual turnover.
Subjects covered in this guide
- Introduction
- Advantages and disadvantages of switching bank accounts
- Comparing different bank accounts
- Negotiate improved terms with your existing bank
- Make your business attractive to other banks
- How to switch banks successfully
- Use different banks for different services
