The bank is enticing new customers with a healthy switching bonus
HSBC has announced that it has relaunched its current account switching bonus, incentivizing customers to switch to the bank to get a £125 bonus.
This is despite claims by the bank as recently as October that it might have to start charging customers for basic banking services across Europe due to a 35 per cent fall in profits for the quarter.
Fight To Build Customer Base
HSBC has been struggling for some time. As well as the quarterly profit drop announced in October, it also saw a large drop in customer numbers.
Official figures from the Current Account Switching Service saw that, in the period of July to September, HSBC gained 5,998 customers but lost 20,861 for a net loss of almost 15,000 customers.
In comparison, the next biggest losers were Santander and Natwest who lost approximately 10,000 customers each, showing HSBC as 50% worse off. It’s expected that numbers could be even worse for the latest period following the October announcement on potential bank charges.
Recent figures have been announced for some other banks – with positive increases reported by Halifax and Lloyds, both of which offered a switching bonus. Halifax’s net gain of 22,742 was more than the second and third place banks – Monzo and Starling – combined. So it’s expected that HSBC’s new switching bonus will have some positive effect on the next quarter’s customer figures.
The new HSBC switching bonus is available immediately, but only for customers at HSBC. It does not apply to the other banks in the same company, namely First Direct and M&S Bank. It also only applies to the Advance account and the Premier Account.
In order to qualify, people need to be a new customer to HSBC, and they cannot hold an account with First Direct or M&S either. If they’ve held an account with any of those banks since 1st January 2018 they are disqualified from the bonus.
Customers must use the Current Account Switching Service to complete a full switch to the new account, which must be done with 30 days of the new account being opened. At least two direct debits or standing orders need to be set up on the account.
To qualify for the Advance account, customers need to qualify for a minimum of a £1,000 arranged overdraft and must either pay in at least £1,750 to the account every month or at least £10,500 every six months if payments are less regular. This can’t include money transferred from any other accounts held by HSBC UK Bank.
For the Premier account, customers must earn a minimum of £75,000, and they need to either have savings of £50,000 with the bank or hold either a mortgage, an investment, a life insurance policy or a protection product with HSBC.