Does switching current accounts affect your credit score?

What is a current account?

High street and app-based banks offer current accounts for day-to-day banking. You can deposit and withdraw cash, set up Direct Debits and other payments, and make bank transfers to other accounts.

Some bank accounts are free, while others charge a monthly fee in return for a package of benefits.

Why is switching current accounts a good idea?

One of the main advantages to switching current accounts is the cash incentive that many banks offer new account holders — switching bonuses of £100–£200 are common, and some accounts also offer ongoing perks like cashback or higher savings rates.

Switching is also much easier than most people expect. The Current Account Switch Service (CASS) is a free service that handles the whole process for you — moving your Direct Debits, standing orders, and balance to your new account within seven working days. Over a million people used it in 2025, the third year in a row the figure has reached seven figures.

That said, switching can have a small impact on your credit score in some circumstances. The key is knowing what to watch out for so you can make the move without affecting your credit profile.

What is a credit score?

Your credit score is a number that represents the risk you pose to lenders when you borrow money.

The higher your score the better, as it will make it easier to borrow money at competitive interest rates.

Does switching banks affect your credit score?

It depends — and the answer is different for everyone. The main factors are whether the bank runs a hard or soft credit check, whether you're applying for an overdraft, and whether you're opening the account jointly with someone else. Each of these is explained below.

Hard and soft credit checks

When you apply to open a new bank account, the bank will carry out either a soft or hard credit check.

• A soft check is usually used to confirm your identity, while a hard check will look at your finances in more detail.
• A hard check can cause a temporary dip in your credit score. Multiple hard credit searches in a short space of time can have a more negative effect on your score.

If you're concerned about the impact on your credit score, it's worth checking which type of search a bank carries out before applying. Some app-based banks — including Starling, Monzo, and Chase — only carry out soft searches when opening a standard current account, which means switching to them won't affect your credit score at all. Always verify this directly with the bank before applying, as policies can change.

The credit scoring impact of switching normally lasts up to six months, after which it disappears from your record. If you make multiple switches within a six-month period, your score may take longer to return to normal.

Overdrafts and credit scores

An overdraft is a way to borrow money from your bank using your current account — it takes your account balance below zero.

Simply having a modest overdraft facility agreed is unlikely to affect your credit score significantly. If you don't use the overdraft, it will appear on your credit file as a balance of zero.

Having access to a larger overdraft could potentially increase your credit score as, if you kept your spending the same, it would lower your credit utilisation ratio.

Stability

Being seen as 'stable' is good for your credit score.

Lenders see sticking with one bank for a long time as a sign of stability, so changing accounts frequently may not be good for your credit score.

But if you have a good credit score and can show stability in other ways — by being on the electoral roll, for example — switching bank accounts will only have a minimal effect on your score.

Direct Debits

When you switch using CASS, all your Direct Debits and standing orders are moved to your new bank automatically and your old account is closed.

This process usually goes smoothly. But if it doesn't, it's possible that a Direct Debit for a household bill or other payment won't be paid, and this can impact your credit score.

Joint accounts

If you open a current account jointly with another person, that person's credit score will affect yours. This is called a 'financial association'.

So, if you open a bank account with someone with bad credit, your score can fall as a result.

When you shouldn't switch bank accounts

It's important to consider your credit score when weighing up switching bank accounts.

• If you plan to apply for a mortgage or large loan in the next six months or so, it might be better to delay switching current accounts until afterwards.
• You should also think carefully before opening a joint account with someone with a poor credit score or who you don't completely trust.

Does a savings account affect my credit score?

Perhaps surprisingly, having savings or a savings account does not affect your credit score either way.

Your credit report does not show how much money you have in savings or investments.

Does closing a bank account affect my credit score?

Closing down a bank account won't affect your credit score as long as you settle your account first.

This means paying off any overdraft and keeping an eye out for any pending transactions that could bring your balance below zero after the account is closed.