There are a few things you need to do before you close your bank account. Follow these four steps.
You're able to close your Australian bank account whenever you like and the process is usually as simple as contacting your bank. However, before you do close your current bank account make sure you open your new bank account. The process will be a lot easier if you have a new bank account ready to go.
Here are the four steps to take if you want to close your bank account.
1. Shop around for a new account
Before you close your current bank account, take the time to shop around and find a new account to replace it with. Here are a few things to consider when you're looking for a new bank account:
- The account keeping fees. Are you closing your bank account because you're sick of paying monthly account keeping fees? Look for a new account that doesn't charge any account keeping fees.
- Travel benefits. Do you travel overseas a lot? If you do, you'd likely benefit from a bank account that has no overseas ATM fees or no foreign transaction fees.
- Contactless payments. Do you love making payments with your phone instead of using your debit card? If you do, make sure you find a bank account that offers Apple Pay, Google Pay or Samsung Pay.
- Linked savings account. If you're looking for a bank account that is linked to a savings account with the same bank, make sure the linked savings account has a competitive interest rate.
Regardless of what you’re searching for, be sure you check out your options before you proceed. The last thing you need is to open a new account, only to find out later that the fees are much higher than what you were paying on your old account.
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When you’ve found the right one to suit your needs, go ahead and open the account.
2. Update debit and credit information
If you’ve already got some direct debit or direct credit payments going into or out of your account, you will need to transfer these over to your new account. You can ask a representative at your new bank to help you with this. They’ll get in touch with your old bank and ask them to provide a list of all your direct debits and direct credits. You’ll be shown the list and asked which of those payments you want shifted across to your new account.
These will include things like:
- Salary credit payments
- Regular direct debit payments for things like your home Internet, your phone bill and Netflix that come out of your account automatically
Be sure to give your new BSB and account number to your employer or payroll officer as soon as possible, to be sure your salary goes to the right account the next time you get paid. You should give the same account information to anyone else who pays you money regularly.
3. Leave a small amount of cash in your current bank account
Now that your new account is ready to go, you can simply transfer your money over by making a bank transfer. Depending on the amount of money you're transferring, you may have to increase your bank account's daily transfer limit so you don't have to split the transfer over a few days. You can do this via Internet banking or your mobile banking app.
Before you transfer all the cash in your old account over to your new bank account, you might want to consider leaving a small amount of money in your old account for a short period of time (for example a few weeks). While you may think you’ve covered all your usual direct debit payments, there is a risk that you may have forgotten something. Leaving some cash in your old account for a short time to cover any payments you may have overlooked will help you avoid missed payment fees or penalties.
4. Close your old account
When you’re sure your new account is up and running properly, it’s time to close your old account. This should only be done when you’re sure all your direct debits and credits have been successfully transferred over and you’ve given your new account details to anyone paying money into that account.
Some banks require you to go into a branch to close your account. Some may ask that you request for the account closure in writing, along with your signature to verify the process. Some banks will allow you to close your bank account over the phone, once you've verified your identity. The easiest way to know for sure which option your bank wants is to call them and ask.
However, don’t make the mistake of thinking your account will be closed over the phone just because you spoke to someone. Banks really don’t want to lose your business, so they will make you work just a little bit to finalise that account closure.