HSBC offers cash incentives for switching
From Monday June 29th to Monday August 31st 2015, HSBC offered new customers willing to switch to a HSBC Advance current account a larger than average bonus of up to £240. This promotion has been accompanied by a significant online marketing campaign; see below the promotion on the landing page of the HSBC UK website.
There were two components to the HSBC Advance current account cash incentive: the first offers anyone who switches to the HSBC Advance current account using the current account switch guarantee system £120 in cash. Secondly, Advance customers can earn an additional £120, in £10 x12 monthly instalments, with the bank’s Save Together offer. To get this, customers need to pay £25 a month into a HSBC Loyalty Cash ISA; alternatively, customers can transfer a lump sum of £300 into the account. The ISA offers new customers an interest of 1.4% AER.
Earlier this year the TNS Current Account survey showed that HSBC was fairing poorly compared to other UK high street banks since the introduction of the UK Payments Council’s account switching service, with 14% leaving HSBC while only 2% joined the bank through the scheme. Meanwhile, banks such as Santander and Halifax gained 19% and 16% of switchers, respectively.
Other UK banks, such as Halifax, have been offering cash incentives for switching for some time now. However, HSBC has taken a slightly different approach by encouraging switchers to sign up for an ISA in addition to a current account. Additionally, unlike other cash incentive we’ve seen as this one targets higher earning customers that are eligible for an Advance account. It will be interesting to see how the new switching incentive, and marketing campaign to promote it, effects switching statistics over the next few months.
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