• Dan Sherrard-Smith

5 reasons to switch your bank

Disclaimer: What follows is not investment advice.


If, like me, you picked your bank in your late teens or early twenties (I did it for the free student railcard), then you may have never considered the impact of switching your bank.


But switching your bank account might have more benefits than you initially realised.


That’s why MyMotherTree.com has pulled together 5 reasons to consider moving your money.


1. Reduce your carbon footprint


Globally we emit 51 billion tonnes of CO2e (the “e” stands for equivalent as it includes other gasses like methane) each year.


97% of scientists agree that the climate crisis is man made. Which means, these colossal emissions, ultimately, come from us.


We contribute to the 51 billion tonnes of emissions in various ways. Typically, this is through our lifestyle choices including:

  1. Our diet: whether we eat meat for instance

  2. How we get around: do we use the car or cycle?

  3. Our home and offices: our choice of energy provider, the materials we use to build it

  4. Our choice of other purchases: including phones, laptops, clothes and cosmetics

But…there is another form of emissions unaccounted for in the above choices: Our finances.


Our choice of bank matters.


Exclusive research by MyMotherTree.com reveals that the banks have wildly different carbon footprints. For instance, £6,700 (the average amount a UK consumer has in savings) in a Barclays current account produces 2.8 tonnes of CO2 per year. That figure falls to 1.1 tonnes if that same amount was with Triodos.


You can find your money carbon footprint at MyMotherTree.com


2. No compromising on customer service

  1. Just like any change of habit, like going from Windows to Mac, from driving a manual to an automatic, it can take a while to get used to a new bank.

  2. But not all banks were created equal.

  3. In fact, according to consumer champion Which? only four banks score over 80% for customer service:

  4. Starling

  5. Monzo

  6. Triodos

  7. First Direct

  8. And the big banks? They languish a long way down the list.


3. No losing out on profit


Interest rates (the amount the bank pays you for saving money with them) on current accounts remain flat.


Interest rates are, for the most part, dictated by the Bank Rate set by the Bank of England to keep inflation low. The logic goes something like this:

  • If the Bank of England changes their Bank Rate, then normally banks change their interest rates.

  • When the Bank Rate comes close to 0%, the interest rate offered by banks reduces.

  • As the Bank Rate starts to rise away, it tends to lead to a rise in saving rates and more money in your pocket.

  • But a glance at the Bank Rate shows that interest rates have been largely flat for almost 10 years.


Source: Bank Rate since 2012.


In short, in terms of the interest rate banks can offer you, there is not a huge amount of difference.


Worth noting, that this is not financial advice and it’s important to do your own research.


MyMotherTree shows the interest rate of banks with the lowest carbon footprint. And there are other sites out there showing all available banks based on interest rates.


4. Fund the future you want to live in


For the first time in human history, we understand the impact humans are having on the planet: From melting ice caps to biodiversity loss. From desertification to polluted air.


This activity is, for the most part, funded by our financial institutions – including our banks. They invest billions into companies either destroying our planet or healing it.


How do the banks get their money? Us.


And because of this knowledge, we are at a pivotal moment.


Is your bank doing enough to fund the future you want to live in?


5. Switching is easy


Switching your bank is refreshingly easy to do.


You can either dip a toe in the water and switch a small amount from your existing provider or move the whole wad.


Moving a small amount, typically, takes 24 hours. It’s 5 minutes to set up for your part and 24 hours for your money to arrive at your new provider.


If you want to transfer all your Direct Debits and standing orders, then it can take up to 10 days. And your money is safe. It’s covered by the government-backed Current Account Switch Guarantee.


So why not give a new bank a go? You never know, it might just be the most important change for the planet and your wallet you make this year :)