The new central IT system used to support the seven-day account switching service has successfully handled tens of thousands of customers moving between banks in the first days since its launch.
The UK Payments Council-backed Current Account Switching Service went live on 16 September with the aim of reducing the amount of time needed for the UK's 46 million current account holders to move between banks, down from the previous average of around 30 days.
A spokesperson for the Payments Council said: “The central IT system on which the service is built is operating smoothly, with initial figures showing that more than 35,000 people have started to switch their account since launch.
"Although it is too early to tell what switching levels will be over the longer term, interest in the new service has clearly got off to a great start.”
According to some claims, the service could mean five million more people moving between banks in the next 12 months, helping to create more competition in the banking sector, and offering opportunities for new market entrants to gain more presence in the current accounts market. A total of 17 high street banks and building societies have signed up to the service from launch, including Lloyds Banking Group, Nationwide, Santander, as well as challenger banks such as Co-op, Metro Bank and Virgin Money, with more to follow in 2014.
The central switching platform was developed as part of an investment from the financial sector, costing £750 million. Much of the cost of the project was related to banks updating their internal systems to comply with the switching service and the development of the central IT platform.
According to the Payments Council, the development and running of the central switching service will cost approximately £100 million over the next five years.
The custom-built platform was put in place by outsourcer CGI, which led on project management, and is run on payments network provider Vocalink's systems. The platform contains the main data as part of the redirections database, mapping old and new accounts. It allows for the forwarding and redirection of payments, with information sent using the ISO 20022 messaging standard.