Incentives on offer to encourage customers to switch banks

Banking customers are being rewarded with benefits including cash and alcohol just for switching financial institutions. These are the deals on offer.

Receiving cash back for using tap and go, being given bottles of wine and getting discounts on gift cards are some of the latest lures used to win over new bank customers.

Convincing consumers to shift their primary bank account to a new financial institution is one of banks’ toughest challenges and has resulted in many wheeling out a range of incentives.

This month HSBC rolled out triple incentives on its Everyday Global Account: a $100 cash bonus, 2 per cent cash back on tap-and-go transactions and bonus interest on savings for new customers who signed up.

Meanwhile, Westpac and its subsidiary brands – St George, Bank of Melbourne and BankSA – offer up to $50 cash back to new customers who sign up to some of their everyday accounts.

Customers are being offered incentives to switch financial institutions. Picture: iStock

Financial comparison website RateCity’s spokeswoman, Sally Tindall, said many Australians felt loyal to their bank and did not often contemplate switching.

“To get someone to switch transaction accounts is no mean feat,” she said.

“The banks are throwing all sorts of incentives on the table to get new customers in the door. But pick the bank account that suits your financial needs before getting caught up in any bonuses.”

Ms Tindall said having free ATM access, the use of Apple Pay or free currency conversion fees could be more appealing to customers than one-off incentives.

HSBC’s head of retail banking and wealth management, Jessica Power, said its new rewards were designed to “encourage people to make HSBC their main bank”.

“Customers using the new rewards program are already earning cash back on their groceries, morning coffees, fuel and dinners out,” she said.

Consumers are often reluctant to switch banks because of the hassle of moving across debits and credits, but a new bank can help do this.

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Citi’s Global Currency Account offers customers a free bottle of wine each time eligible customers dine at one of the bank’s partner restaurants.

The bank’s Australian head of retail banking, Kate Luft, said these types of incentives “give value back to the clients”.

“These offerings aren’t to benefit the bank … it’s about how we continue to be differentiated in giving value back to the customer at the end of the day,” she said.

Ms Tindall said winning new customers was big business for lenders, because it often led to them signing up to lucrative products, including credit cards, personal loans and mortgages.

HOW TO SWITCH BANKS

• Find a good transaction account.

• Ask your existing bank to help you switch.

• They will get a 13-month list of your direct debits and recurring payments.

• Give this list to your new bank.

• Ask your new bank to help move the ones across the relevant debits and credits.

• Remember this list will not include all of your payments.

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