HSBC fightback? Banking giant offers switching bribe of £125 just months after suggesting customers could have to pay for current accounts
- HSBC offers customers £125 cash incentive for advance and premier accounts
- Last October, hinted it could start charging for basic banking services
- Saw a huge outflow of current account switchers between July and September
HSBC has relaunched its current account switching incentive just months after suggesting that customers could start having to pay for basic banking.
The banking giant is offering £125 to those switching to its advance or premier current accounts using the seven day Current Account Switch Service.
Last October, it claimed it could start charging for basic banking services in Europe after a 35 per cent fall in quarterly profits.
Talking about the UK specifically, a spokesman at the time said: ‘We always keep under review the pricing for our standard current accounts and associated services.’
New customers: The move from HSBC suggests it is looking to turn the tide after losing ground in the current account switching battle
Additionally, the bank was recently revealed to be the big loser in the battle for current account customers using the official service, and that was before its comments on the potential end of free banking.
Between 1 July and end of September, it hemorrhaged a net 14,863 current account customers who used CASS to head to pastures new – of this figure, it gained 5,998 switchers, but lost 20,861.
This outflow was far larger than the next two biggest losers, Santander and NatWest, who lost a net 10,029 and 9,717 customers respectively.
While figures for the last three months will not be revealed for a little while yet, HSBC could have lost even more switchers in the aftermath of the comments from October.
The cash offer is available from today, but only at HSBC – not at its stablemates First Direct and M&S Bank.
To qualify as a new customer, those looking to take advantage must not be an HSBC current account holder (or First Direct and M&S) on the date of application and have not been on or after 1 January 2018.
Customers must use the CASS to complete a full switch within 30 days of account opening with a minimum of two direct debits and/or standing orders.
There are also other hoops to jump. For the advance account, you’ll need to qualify for a minimum £1,000 arranged overdraft, paying at least £1,750 a month into the account each month, or a minimum of £10,500 every six months.
This does not include money transferred from any other sole or joint personal accounts held with HSBC UK Bank.
For its premier account, you’ll need an individual annual income of at least £75,000 and one of the following with HSBC UK: a mortgage, an investment, life insurance or a protection product; or within 6 months, having savings and/or investments of at least £50,000 with HSBC UK.
It says customers can use its Home and Away discounts, which offers savings at retailers such as Asos, Costa Coffee and Not on the High Street.
Current account switching bounced back in the last three months of 2020 as customers took advantage of three-figure switching bonuses from Britain’s biggest banks.
Some 189,000 accounts were switched through the official seven-day service between October and December, with November seeing the highest number of switchers at 80,000 since March 2020.
The data showed that stablemates Halifax and Lloyds benefited from the relaunching of current account switching bonuses, with both banks gaining thousands of customers.
The only other banks to show a net volume of current account switchers are Starling, Monzo, Triodos and Bank of Scotland.
Halifax saw a net influx of 22,742 customers. It relaunched its switching incentive in August. This was more than the next two biggest gainers combined – Monzo and Starling – suggesting it is banking bribes, and challengers, that are attracting the most attention.