Switching your current account: the banks’ account switching service

In short: When you switch your current account, you can ask the new bank to take over standing orders, direct debits and incoming payments; this is regulated by law and costs nothing extra.

In more detail: In Germany consumers have a right to an account switching service under the Payment Accounts Act. The new bank organises the switch; you do not have to send the new IBAN to every sender yourself.

In Depth

Process

1. Open the new account and choose the account switching service in the application.
2. You give the new bank a power of attorney; it asks the old bank for the list of standing orders and direct debits.
3. The new bank sets up standing orders and informs payment partners (employer, landlord, insurers) about the new IBAN.
4. The old account is closed on the agreed date and any balance is transferred.

Tips

• Let old and new accounts run in parallel for a while until all payments are switched.
• Check your own incoming payments: salary, child benefit, apprenticeship pay, refunds.
• Update overdraft, credit card and online accounts (for example PayPal) with the new IBAN; they are often not part of the service.
• Check the old bank’s notice periods and fees; account fees for current accounts must be reasonable.
• Basic account: every consumer in the EU has a right to an account with basic functions, even with a poor credit score.

What to look for when choosing

Costs (account, card, cash withdrawals), branch or ATM network, app quality, overdraft rate, deposit guarantee (in the EU up to €100,000 per customer and bank). Students and apprentices often get free accounts. Minors need their parents’ consent for an account.

See also: Current account for minors, IBAN and SEPA, Overdraft