5-minute guide to switching your current account

Why should I bother?

If you've had the same bank account since childhood or student days, it's unlikely to be your best option now. Plus, current accounts have become competitive. "You can get great perks and high-interest payments and it only takes a week to switch," says Rachel Springall at Moneyfacts.co.uk.

Is it right I can get a better rate than with some savings accounts?

Some current accounts offer rates up to 5% AER compared to the average top 10 savings rate of 1.25% - and 16% of people aged 55-plus have moved savings to a current account to take advantage, says Moneysupermarket.com.

If you've had the same bank account since childhood, it's unlikely to be your best option now

Are there any restrictions on getting these better rates?

Some have minimum funding requirements - for instance TSB's Classic Plus account requires £500 to be deposited monthly leaving some out in the cold. However not all require this including Virgin Money's Essentials Current Account paying 1% AER and M&S Bank's current account which offers access to a 12-month fixed-rate saver paying 6%.

  • Beware: Going overdrawn could void an interest deal.

What other perks are on offer?

Some offer bonuses for instance Halifax pays £5 monthly on its reward current account so long as you deposit £750 monthly and set up two direct debits. While Santander's 123 current account pays cashback on certain direct debits up to 3% in return for a £2 monthly fee, £500 monthly funding and setting up two direct debits.

But isn't switching a laborious process

Not now it's backed by the Switch Guarantee. Changing should be simple and take just seven working days. Plus there's a redirection service in place for payments which lasts 36 months after you've moved account. Your new provider sorts everything for you and must refund you if something goes wrong during the switch.

  • Tip: The Current Account Switch Service covers joint account switches, too.

5 steps to switching

  1. Choose your new bank or building society and ask them to switch for you
  2. Agree the 'Current Account Switch Agreement' and the 'Current Account Closure Agreement' - provided by your bank so the switch can go ahead
  3. Choose your switch date - allowing seven working days
  4. You continue to use your old account until your agreed switch date
  5. Your new provider will transfer your incoming/outgoing payments, your balance (overdraft transfer subject to credit status), close your old account and confirm the switch is complete.
  • Did you know: 1.14m people switched bank accounts in the last year. Source: Payments Council
  • It's a fact: We're loyal to our current account provider for 17 years - 5 and a half years longer than the average British marriage lasts, Source: ONS/Payments Council

Find out about Renault's new bank account here. Plus you can now squirrel away more in Premium Bonds. More here.