Crucially, a key development will be the extension of the redirection service operated by. This is designed to give further assurance to customers that all their payments will be switched from their old account to their new one, and so overcome a key concern about moving banks.

Currently, only 4% of business and 3% of individual customers switch banks in any given year. The CMA estimates small firms could realise savings of around £80 a year on average, while personal customers could save £92.

Bacs must also work with banks and increase both awareness of and confidence in the Current Account Switch Service.

The introduction of independence to the switching service has already been achieved, the CMA said. Previously run by the banks it represented, the Current Account Switch Service now has an independent chair in place.

Alasdair Smith, chair of the CMA retail banking market investigation, said: ‘Switching is the key way for people and small firms to find better banking deals and save money. Improvements to the switching service will give customers better information about, and so greater control over, their finances. This in turn will make it easier to move their money and capitalise on better offers.

‘Our banking investigation demanded that banks worked harder for their customers. Taken together, its 17 recommendations will save customers between £700m and £1bn over five years.’

Further reforms will be announced ‘shortly’, the CMA said.