Analysis: Until switching banks is as easy as switching mobile network, most of us will stay in the same financial relationship we began in college
In 2012, UK shadow chancellor Ed Balls declared that "you're more likely to be divorced than to change your bank account." Channel 4 later fact-checked the claim and found that people do switch banks more often statistically than they split from their partners. Yet the line has stuck, quoted endlessly by journalists, regulators and politicians, not because it’s numerically correct, but because it feels true. Few relationships in life last as long as the one most of us have with our bank. Some may argue that we can have many banking providers at once, however, the salary is usually paid into a single account.
While we may not actually be more likely to get divorced than change banks, Ireland’s switching rates are still among the lowest in Europe. A 2022 Department of Finance survey found that only two to five percent of people had switched banks in the previous five years, and that 84% had never even considered it.
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From RTÉ Radio 1's Today with Claire Byrne, what's involved in switching banks?
When Ulster Bank and KBC announced their departure from the Irish market, forcing around one million customers to move accounts, policymakers expected a flood of switching. Instead, the Competition and Consumer Protection Commission (CCPC) discovered that only 44% of affected customers had opened a new account ahead of the impending deadline. Even when the change was unavoidable, inertia reigned.
Why is this the case? Behavioural economists have a long list of answers, including status-quo bias, ambiguity aversion, present bias and "hassle costs". In plain English, we stick with what we know, we dislike uncertainty and we tend to put off anything that looks like a chore.
But there is something more fundamentally wrong with the switching process. Ensuring that every payee, direct debit and incoming payment is correct is the responsibility of the account holder. The rational reward is maybe saving a few euro a month in fees which rarely outweighs the imagined pain of the process. Surveys back this up. In the CCPC’s research, the most common difficulty reported by those who had started switching was "moving payments between banks." Other complaints included too many forms, a lack of in-person support and a process that simply took too long.
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From RTÉ Radio 1's Today with Claire Byrne, what's the best current account for you?
Only seven percent of people planning to switch said they intended to use the official Central Bank Switching Code, which guarantees that a switch should be completed within ten working days. Even when the infrastructure exists, awareness and trust in it remain low. This is exacerbated by the consumer experience of switching delays during the KBC and Ulster exits.
This helps explain why the Irish banking landscape looks so static. The Central Bank’s own behavioural note from 2023 described inertia as "pervasive across financial markets". Mortgage and savings account switching rates are equally tiny, and lower-income or less-educated consumers are least likely to move, even when the potential savings are significant. This is not helped by an effective duopoly market.
Banks have long understood this psychology. That’s why they have fought for decades to secure branch locations on university campuses. If you win the student, the thinking goes, you win a customer for life. Once a direct-debit trail is established, the effort of moving it elsewhere becomes the biggest retention strategy of all.
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From RTÉ Brainstorm, why banks need to maintain cash services for customers
Low mobility doesn’t just affect individuals, but also shapes the market itself. When customers rarely move, competition stagnates. Banks face little pressure to innovate or cut fees if they know most people will stay put regardless. Dismal IT failures like Bank of Ireland’s €24.5 million fine in 2021 show that poor service doesn’t always drive customers away. Inertia still shields incumbents.
The Central Bank recognises that the ability of consumers to switch easily is essential to a healthy market. That’s why recent policy reviews have emphasised making switching seamless, not just possible. There are signs that attitudes are slowly changing. Digital-only providers like Revolut and N26 have made multi-banking common. An Accenture study in 2024 found that 80% of Irish consumers now use more than one bank, one of the highest figures in Europe.
But multiple accounts aren’t the same as switching. Though this non-monogamous relationship may benefit us, allowing individuals to get the best relative service from each provider, most people still keep their salary, mortgage and direct debits anchored to the same "main" bank they opened as students. Revolut might hold their spending money, but the old current account still runs their life.
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From RTÉ Radio 1's Liveline, listeners talk about difficulties changing bank
Age also plays a role. People in their 50s and 60s are the least likely to switch. Psychologists suggest that older consumers place higher value on familiarity and reliability, while younger people are more comfortable experimenting with new digital providers. In effect, the longer we’ve been with a bank, the harder it feels to leave it.
True change may require a structural fix. Other countries, notably the UK, have gone furthest by introducing a Current Account Switch Service that automatically transfers all payments and redirects anything sent to the old account. It’s effectively the banking version of mail forwarding.
Both switching banks and getting divorced involve paperwork, uncertainty and the unsettling thought of starting over
Irish regulators have discussed similar ideas, but full account-number portability (keeping your IBAN when you move, like keeping your phone number) would require rewriting banks’ 1970s-era legacy systems. However, supporting this argument enables continuing stifled incumbent innovation where their digital competitors can easily adapt.
So, are we really more likely to get divorced than switch banks? Statistically, no. But emotionally, perhaps yes. Both involve paperwork, uncertainty and the unsettling thought of starting over. Until switching becomes as simple as changing your mobile network, or until a bank finally offers IBAN portability, most of us will stay in the same financial relationship we began in college as there are insufficient incentives.
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The views expressed here are those of the author and do not represent or reflect the views of RTÉ
