How to switch your business bank account and find the best offers

A business bank account can give you far more than a standard current account, from tailored features to perks that make managing your money easier. But don’t assume every account is alike, or that the one you already have is the best fit.

Reviewing the market regularly helps ensure you’re getting the most value, and switching is often quick and straightforward for most businesses.

Why might you switch business bank accounts?

There are plenty of reasons to consider switching your business bank account. Your needs may have evolved since you first opened it – perhaps when you set up your company, or started working for yourself. What suited you then might no longer be the best fit now. Equally, a negative experience with your current provider could be all the motivation you need to look elsewhere.

Here are the main reasons people think about switching business bank accounts:

• Fees and other costs – Business bank accounts often come with charges. The best accounts keep fees to a minimum, but terms and conditions change over time, and this can render a previously good account less attractive

• Welcome awards – Many banks offer incentives to win new business customers. These can include cashback or sign-up bonuses when you open an account, as well as fee-free everyday transactions for a limited introductory period.

• Extras – Business bank accounts feature benefits to win customers from the competition. Depending on your company’s setup, advantages such as cashback, low rates on everyday transactions, no monthly fees and free accounting software can all be attractive

• Access – Some businesses need to make cash deposits and withdrawals, especially if their customers typically pay in cash. If your local branch shuts, you may want to switch to a bank that has a local high street presence

• Customer service – Every business needs reliable access to its bank, especially when issues inevitably crop up. If customer service falls short, it’s a strong signal to consider switching. To help, the Competition and Markets Authority publishes an independent survey ranking providers on customer service, which can be a useful resource when weighing up your options.

How do you switch business bank accounts?

If you run a business with an annual turnover not exceeding £6.5 million and you employ fewer than 50 staff, you can use the Current Account Switch Service (CASS), which simplifies the process. Around 99% of UK banks and building societies offer CASS. Your new bank or building society handles the transfer of your money and payments, including Direct Debits. Once everything is in place, your previous provider closes your old account. 

What to do before applying

If you’re keen to switch your business bank account, take time to review your payments. Check you still need all your standing orders and Direct Debits, and cancel any that are no longer relevant or you can’t afford. 

Also, take copies of any transactions you may need at a later date. HMRC may want to see records going back a few years if there’s a query over your accounts. 

Likewise, retain evidence of payments to suppliers, staff and contractors, as well as proof of purchases, just in case you have a problem with a specific buy.

How to switch accounts

It takes up to seven days to switch business bank accounts, starting from the point your new bank or building society receives your application. As each provider differs in the information they require, read through the form and provide the necessary details in the right format.

Typically, you must supply some, if not all, of the following, and perhaps some extra information too:

• Details of the account you want to switch from, including the account number and sort code

• Your full name and contact details, including your home postal address

• Your business name and address

• The date you want to switch accounts

• Your Companies House registration number (if you operate as a limited company)

• Proof of ID, such as a bank statement or driving licence

• A signed copy of the Current Account Switch Agreement and the Current Account Closure Instruction

What else should you do when switching a business bank account?

You can continue to use your old account during the switching process, but you can’t set up any new payments, because these won’t transfer to the new account. 

When you’re told that your new account is up and running, destroy any debit cards for your old account. Also, to avoid any maintenance fees, check that the old account has closed, unless you have made a partial switch. (Partial switches are useful if you can’t clear or transfer your overdraft, for example.)

Finally, let your suppliers and clients know your new account details to avoid any confusion or delays. 

How to find a switching deal that works for your business

Finding the best business account for your company is a three-step process. 

First, identify what you want from an account. Some fees, for instance, are less important than others. For example, it may be worth a tradesman paying a higher monthly fee if the bank or building society charges less for individual transactions. For an architect, a lower monthly charge might work out better, because such a firm sees fewer individual transactions than a shopkeeper would, for example. 

Second, once you’ve pinpointed your needs, use comparison sites or brokers, and run internet searches to find the best accounts. Take note of any fees, introductory offers, overdraft facilities and interest charges, and read the small print.

Third, consider customer service. Search for reviews, news and other sources of information that indicate whether your chosen account provider offers a good service. Ask friends and colleagues for recommendations, too.

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