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An estimated 1.1 million current account customers have switched provider in the 11 months since the initiative was launched.
The number of switches between 1 October 2013 and 31 August 2014 represents a 19% increase in the number of current account moves recorded during the same period a year earlier, the Payments Council said.
The figures were published in a progress report into the service, which launched on 16 September last year. The scheme allows people to move to a new bank in seven working days, instead of up to 30 days previously. Outgoing and incoming payments are also automatically moved to the new account.
The Payments Council, which commissions monthly surveys of more than 2,000 consumers to assess awareness and satisfaction levels of the service, said 70% of people had heard of the scheme and 61% were confident about what it was and how it worked. An estimated 88% of consumers who had switched accounts felt it took very little effort on their part, the watchdog said.
The Payments Council is measuring the success of the scheme on awareness and confidence rather than the number of switches, as some people may be happy with their existing bank and may not want to switch. A target that 75% of people should be aware of and confident in the service has been set for the end of June next year.
The service, which covers almost all of the UK's current account market, can be used by small businesses and charities as well as consumers. Banks often use their relationship with current account customers as a basis to sell them other products.
There have been signs of increasing competition between current account providers over the past year, with several current accounts offering better rates of interest than a customer would expect from an easy access savings account.
TSB and Nationwide offer current accounts with a 5% rate of interest; Lloyds Bank offers a current account paying up to 4% interest; Santander's 123 account pays 3% interest plus cashback on household bills. Halifax offers an account that pays £5 a month as well as up to £100 to people who switch to it. The Co-operative Bank is offering people £100 to switch to it plus a £25 donation to charity; First Direct, the internet and telephone bank which regularly tops consumer satisfaction surveys, is also offering £100 to switch.
New players are also taking on high street banks, with Marks & Spencer recently announcing its first "free" current account and Tesco Bank launching its first current account.
Gerard Lemos, executive chairman of the Payments Council said: "The service was designed to make life easier for customers by removing barriers to switching, with the aim of boosting competition in the banking sector. It's clear from reviewing its first year that it's made great ground – empowering customers with the ability to switch their bank account easily and quickly if they choose to do so."
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