Very rarely would any business tell their customers to pack up and head on over to their competition. However, that is exactly what two of the UK’s biggest banks are doing. If you’re a business customer of RBS or Natwest, you may have already been told that you’ll be affected. Although this will mean extra hassle for thousands of business owners, you could come out of it with a better deal and could even get a cash incentive to make the move. It’s called the Business Bank Switch (BBS) and we’ve got all the essential info you need below.
Why is this happening?
During the financial crash of 2008/09 RBS and Natwest received help from the government. In exchange they agreed to improve competition in the UK business banking market and decrease their own market share.
They earmarked thousands of customers to move to a new bank called Williams & Glyn. However, that’s no longer happening. Instead those customers will now get to choose from 11 other banks to switch to.
Who does it affect?
If you’re eligible to take part, you should have been contacted by RBS or Natwest already. You’ll need to be a business or commercial customer with a turnover of up to £25 million. Participating banks may have their own eligibility criteria as well.
What do I get out of it?
For many businesses this will be a time-consuming hassle. You may have been happily banking with RBS for decades, so being told to leave when you’ve got a dozen other plates to spin will be unwelcome news.
To help soften the blow, the switching scheme is incentivised. It’s designed to give you offers that are better than those normally available on the market. This could range from free banking to cash for switching. Each organisation will have their own offers, so it could end up being a good win for your business.
Who can I switch to?
11 organisations are participating in the scheme:
- Arbuthnot Latham & Co Ltd
- Co-operative Bank plc
- Clydesdale Bank plc
- Hampden & Co
- Metro Bank plc
- Monzo bank plc
- Nationwide plc
- Santander UK
- Starling Bank Ltd
- Svenska Handelsbanken AB
- TSB Bank plc
When does this happen?
The scheme goes live on 25th February 2019. It will be a busy time with all the participating organisations moving to win new customers. Businesses that move quickly may be better placed to take advantage of any incentives, so do your homework and be ready to go on the 25th.
How do I switch?
You’ll be able to click on any of the 11 participants you’re interested in hearing from. They’ll then get in touch with you with their offers. Pick the one you want and your old and new bank will help you make the switch.
Can I refinance my debt?
Although this will take up valuable time, it’s an opportunity to look at your finances and see if you can get a better deal elsewhere. For example if you need to move business debt, you could refinance or get a funding boost at the same time.
There could be other reasons too. While your new bank may have a great offer for your current account, they may not be able to take on your debt as well, or it may take several weeks to sort out.
So you can get back to running your business, at Funding Circle you could refinance your debt with an affordable, fixed-rate loan in a matter of days. It only takes 10 minutes to apply online and you’ll get a decision typically in 24 hours. We also partner with Santander, so if you switch and apply through them, you’ll get a discount on your loan fee.
Check if you’re eligible for a loan in 30 seconds at fundingcircle.com.