TO SWITCH OR NOT TO RBS SWITCH

If you or any of your clients have a turnover less than £25m and bank with a part of the RBS Group that was originally going to move to a new Williams & Glyns Bank, then you’ve probably already heard of the Business Banking Switch Scheme.

In 2008/09 The Royal Bank Of Scotland received significant financial support from the UK Government (don’t think anyone would have missed that news at the time and the original £46bn of support) and because of this support the European Commission have forced the bank to open up to more competition.

Originally this was to be by way of a sale of part of the business and then later via a brand-new bank. However, both these plans failed, in part because of the complexities of splitting the IT systems and the cost of it, and now the European Commission have lost patience (understandably) and are forcing them to actively ensure c120,000 of their customer switch elsewhere to other banks.

In order to encourage this, there is a pot of money put aside of c£275m to incentivise customers to move to one of the 10 banks on the scheme and some of the sums being offered to move are considerable, so well worth considering.

According to the Times though, interest from RBS customers has dropped since the scheme was announced. Around 18,000 customers are believed to have transferred but those registering interest has fallen dramatically. Given RBS HAS to achieve these transfers out of the bank, you can only think that the incentives being offered will continue to increase so there may be more to come.

We at Snowball can help advice RBS clients as to whether to move, who to move to and help negotiate the deal itself. If you wish to know more, please contact us.

 

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