Ethical banking in demand as Co-op current accounts report 123% surge

13 April 2009 / by Rachael Stiles
The Co-operative Bank has reported an annual increase of 123% in the number of customers switching in to its current account, suggesting that ethical banking might be experiencing a rise in demand.

Research shows that the customers most likely to switch to Co-operative current accounts are largely coming from the large high street banks, such as HBOS, Lloyds and RBS.

In the last month, the number of customers switching from RBS to ethical banking provider The Co-operative has doubled, which, The Co-op says, coincided with former RBS chief Sir Fred Goodwin's mammoth pension pot becoming public knowledge.

This urged people to "vote with their feet," the Co-op said, for which last month also marked the highest ever volume of customers switching in.

"There is a growing dissatisfaction with the major high street providers and customers are now no longer prepared to stay loyal to their existing bank, if they are frustrated with the service or have concerns about the security or values of the institution," commented John Barker, head of Co-operative Bank current accounts.

The movements in the current account market over the last year are bucking a trend, he said, as the credit crunch has changed people's priorities:

"Although the current account market is generally thought of as stagnant, our records show that since mid 2008 the market as a whole has started to change, with customers seeking security and looking to move their money to organisations they can trust," Mr Barker said.

"This type of growth is normally rare in the traditionally stagnant switching market and in the past increases of this kind have only been possible by spending vast sums of money on incentives for customers to switch".

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