Banks have begun tempting businesses to switch away from Royal Bank of Scotland as part of a scheme to boost competition in the sector.
As a condition of RBS’ £45bn government bailout during the financial crisis – £350m of a state aid package has been provided to 10 other banks to help them attract firms.
The money has been used to develop business banking offers better than those currently on the market.
Earlier this year the Banking Competition Remedies body (BCR) - the company established to manage the programme - announced several banks had been successful, including Metro, Starling, Santander, Co-operative, CYBG and TSB. Those six, along with Arbuthnot Latham, Hampden, Handelsbanken and Habib Bank Zurich plc have all gone live with new offers.
Monzo and Nationwide, who were chosen despite not having a business account offering, will join the scheme once they have developed business banking. RBS has actively begun promoting the banks on its own website and its business clients will be able to explore their offers.
Godfrey Cromwell, chairman of BCR said it was “very good news that a broad selection of organisations have stepped forward and made a diversity of offers right across the SME client-base”.
Liam Kane, Regional Director, Commercial Banking, North and Scotland, Royal Bank of Scotland explains further...
What is Business Banking Switch?
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Business Banking Switch is a unique scheme for eligible business customers of RBS. It provides these customers with the opportunity to choose from a range of exclusive offers to switch their business current account to one of 10 banks participating in the scheme.
Why has Business Banking Switch launched?
It may sound bizarre that we are asking some of our customers to consider joining another bank. It’s part of the bank’s commitment to increase competition in the 海角视频 business banking sector.
Following support RBS received from the 海角视频 Government during the financial crisis around a decade ago, it was required to divest several parts of its business and increase competition in the 海角视频’s business banking marketplace.
Business Banking Switch is helping RBS fulfil these obligations. The scheme is supported by £275m from RBS which participating banks can use to create incentives for customers to switch their accounts.
Who is eligible for the Business Banking Switch scheme?
More than 25,000 businesses in Greater Manchester are eligible to take part in the Business Banking Switch scheme.
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Customers will bank with Royal Bank of Scotland, have a company turnover below £25m and will have previously been due to transfer to Williams & Glyn. Certain NatWest customers who were due to transfer to Williams & Glyn will also be eligible.
These customers will have received communications from the Bank to let them know about the scheme to let them know they’re eligible and how they can view the exclusive offers available to them.
What banks are participating in Business Banking Switch?
The following 10 banks are participating in the scheme so there should be plenty of offers for customers to choose from:
- Arbuthnot Latham & Co
- Clydesdale & Yorkshire Bank
- Habib Bank Zurich plc
- Hampden & Co
- Handelsbanken
- Metro Bank
- Santander 海角视频
- Starling Bank
- The Co-operative Bank
- TSB
What are the benefits of switching?
The Business Banking Switch offers are market-leading.
These include preferential terms such as free banking, a cash offer and/or something specific to support businesses. Additional incentives are available to customers if they also choose to switch any existing loans they have with us.
Customers who have switched so far through Business Banking Switch rate their experience positively with around nine in 10 saying it was easy for them to switch.
How is the scheme progressing?
Business Banking Switch launched to customers in February 2019.
The scheme appears to be helping to further business current account switching. Recent data from the Current Account Switch Service (an industry body that focuses on bank switching) showed that the overall market for business bank account switching more than doubled in the first four months after the scheme launched in February.
We are doing all we can to make Business Banking Switch a success and are working positively with all the organisations that have an important part to play in delivering the scheme.
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How can firms make the switch and how long will it take?
We think that it’s really straight forward for customers to review their exclusive offers. Eligible customers just need to enter their sort code and account number on the dedicated website to see their list of offers from the participating banks.
They can then find out more directly from the participating banks with offers that are of interest to them.
Most customers will be eligible to use the Current Account Switch Service - a free service that makes switching bank accounts quick and simple, transferring incoming and outgoing payments along with any with any credit balance from your old business current account.