Only four to six per cent of people switch their PCA each year, and the researchers found as many as eight in ten are unlikely to consider it, despite the introduction of the Current Account Switching Service (CASS) in 2013, which has streamlined the switching process.

The market for PCAs in the UK is significant: an estimated 68 million active PCAs generated revenues of £8.7 billion for providers in 2014.  Retail banking is dominated by the four largest banks which account for around 70 per cent of active PCAs.  There are concerns that the market is not competitive and is not working in the best interest of consumers.

The Competition and Markets Authority’s (CMA’s) investigation into lack of competition in the personal current account market has proposed a number of remedies that are designed to promote higher levels of switching which focus on barriers such as the need for trigger points, for better information on price and service quality and for greater awareness of and improvements to CASS.

Yvette Hartfree and colleagues at Bristol's Personal Finance Research Centre found that such measures may assist the minority of dissatisfied customers who would like to switch but are deterred from doing so by lack of information or fears that the process will not be straightforward.  However, these remedies will not address the inertia that keeps the great majority of customers ‘moored’ to their existing provider.

While many people may not be entirely satisfied with the service they get, their level of dissatisfaction is not great enough to trigger consideration of switching.  For those that have considered switching, but not followed it through, the main barriers are the loss of a valued relationship with their existing provider, the perceived hassle of the switching process and the fear of things going wrong.  Indeed, they express a desire for regulators to tackle the culture and service standards of banks and do not think that customers should be expected to switch to get a better service, the researchers found.

Yvette Hartfree said: “While the personal current account market does not appear to be working well in terms of competition, as measured by switching rates, most customers would rather that poor levels of service in the banking industry were addressed, rather than the solution be their having to switch providers in order to get a better service.”