Up to 500 customers per week are switching banks

Between 400 and 500 people a week are changing their bank accounts under a new code implemented by the industry this year.

The Irish Bankers' Federation (IBF) said yesterday that over 5,000 people have used the switching code to move their current accounts from one institution to another since it was introduced in February. The number translates into between 400 and 500 people a week, and is in line with the average in the UK, where a similar system has been operating for several years.

If consumers continue to switch accounts at this rate, the total for the first year should be over 20,000.

The federation developed the system in response to concerns that difficulties that consumers encountered when attempting to switch bank accounts were creating an effective bar to competition.

The Competition Authority recently argued that similar problems encountered by small and medium-sized enterprises limited customer choice in this sector as well. However, The Irish Times understands that the federation is now seeking to introduce a similar system for small business.

Under the code, participating banks have to make three key commitments to customers.

The first is to provide them with clear information on what is involved, who is responsible and how long it will take.

The second is for the new bank to have the customer's new account up and running within 10 days.

The third is for the old bank to transfer direct debits and standing orders to the new institution within seven working days of getting a signed transfer account form.

Fourteen of the Republic's main banks and building societies have agreed to implement the code.

Commenting on the take-up figures, IBF chief executive, Pat Farrell, said the numbers of people switching accounts confirmed the code's "value and relevance".